Unveiling the Night Economy: Boosting Consumer Spending in China

Transforming Nightlife in Henan

Central China’s Henan province, home to the world’s largest iPhone factory, has recently announced initiatives to boost consumer spending at night, addressing the challenges posed by declining exports. The provincial development and reform commission introduced a circular encouraging local government agencies to utilize reserve land to establish distinctive nighttime fairs alongside essential facilities like parking lots and offices.

Creating Vibrant Night Scenes

• Development of music festivals, theatre performances, art exhibitions, and sporting events.
• Introduction of emerging businesses like 24-hour bookstores and late-night cafés.
• Support for entrepreneurship among college graduates and the unemployed to establish stalls at local night markets.

The night economy is recognized as a vital engine for cultivating markets, promoting employment, and expanding consumption. The commission highlighted that fair operators with sales under 100,000 yuan (US$14,138) would be exempt from tax, a significant government incentive.

Addressing Export Concerns

With exports in the first seven months experiencing a downturn of 15 percent in value to 244.1 billion yuan (US$34.5 billion), Henan is not isolated in prioritizing consumption. The central government has also initiated trade-in schemes to drive domestic demand, reflecting a nationwide push to enhance nighttime consumption.

Night Economy Growth Across China

Since 2019, major cities like Shanghai, Beijing, Guangzhou, and Shenzhen have also taken steps to promote their nightlife. The State Council issued directives in 2019 to enhance nighttime business activities as part of a broader initiative to boost national consumption. Notably, over 60 percent of China's consumption occurs at night, with the market size of the night economy doubling from 22.54 trillion yuan in 2018 to 50.25 trillion in 2023, according to state-backed CCTV.