D uring China's economic boom years, the Qixi Festival, also known as the Chinese version of Valentine's Day, was marked by lavish displays of affection. Young couples often showcased extravagant gifts—brand-new iPhones, Louis Vuitton handbags—and celebrated with upscale dinners. However, this year's festival on Saturday painted a starkly different picture.
As the hashtag “consumption plummets on Chinese Valentine’s Day. Are young people unwilling to pay the love tax?” topped Weibo’s trending topics with 200 million views, it became evident that the festive spirit was notably subdued. Many took to social media to express their disappointment over the lack of gift-giving and celebration, attributing it to a sluggish economy and challenging job market.
One user noted, “The Qixi Festival feels almost desolate compared to previous years,” while flower shop owners on Xiaohongshu shared images of unsold roses and empty stores. CNN could not independently verify these claims, but they reflect a broader sentiment that economic hardships are dampening festive cheer.
China's once-thriving economy, which was the envy of the world, is now plagued by numerous issues, including weak consumer spending, a persistent property slump, and a growing debt crisis. Alfred Wu, an associate professor at the Lee Kuan Yew School of Public Policy, pointed out that young people, who used to splurge during Qixi, are now struggling to find jobs and are financially conservative due to overall negative sentiment.
This shift in consumer behavior is part of a broader “weak-consumption trend” that has been evident over the past two years. Market strategist Yeap Jun Rong noted that consumer confidence in China is “hovering around its record low,” which aligns with declining spending patterns observed during the festival.
The impact on global businesses is significant. Major Western companies, including L’Oréal and Volkswagen, have recently voiced concerns over weak demand in China. L’Oréal CEO Nicolas Hieronimus highlighted that low consumer confidence in China has contributed to lower-than-expected growth in the global beauty sector.
The Chinese government's efforts to encourage marriage, seen as a solution to falling birth rates and an aging population, are also being undermined. In the first half of 2024, marriage rates were half of what they were a decade ago, according to the Ministry of Civil Affairs. Despite a state broadcaster's attempt to celebrate family life by showcasing rare portraits of Xi Jinping and his family, the message failed to resonate with many who are burdened by debt and long working hours, including the notorious “996” and “007” work cultures.
Trade data further underscores the economic strain. Imports of jewellery-grade diamonds dropped by 28% in the first half of 2024 compared to the same period in 2023. Similarly, China’s direct investment liabilities fell by nearly $15 billion in the April to June quarter, marking only the second decline since 1998.
The Qixi Festival, celebrated for thousands of years on the seventh day of the seventh month in the lunar calendar, traditionally offered a fertile opportunity for marketing and commercial ventures. However, global CEOs are now questioning the reliability of China as a commercial powerhouse. WPP reported a 25% drop in second-quarter revenue in China, and Volkswagen and Mercedes-Benz expressed uncertainty about when consumer sentiment will recover.
As China grapples with economic challenges and shifting consumer behaviors, the Qixi Festival serves as a poignant reminder of the broader struggles facing the country’s economy and its impact on both domestic and international markets.
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