services

China’s private Caixin services PMI reaches 52.2 in April, expanding for 16th consecutive month

A sales manager arranges gold jewelry inside a shop in Renhuai, Southwest China's Guizhou Province on April 18, 2024. The continuous rise of global gold prices has warmed up gold sales in China. In 2023, China's gold jewelry consumption hit 706.48 tons, a year-on-year increase of 7.97 percent, data showed. Photo: cnsphoto

A sales manager arranges gold jewelry inside a shop in Renhuai, Southwest China’s Guizhou Province on April 18, 2024. The continuous rise of global gold prices has warmed up gold sales in China. In 2023, China’s gold jewelry consumption hit 706.48 tons, a year-on-year increase of 7.97 percent, data showed. Photo: cnsphoto

The Caixin China General Services Purchasing Managers’ Index (PMI) came in at 52.5 in April, expanding for the 16th consecutive month, according to data released by Caixin on Monday. Chinese observers said the figure reflected accelerated momentum in China’s broad services activity.

The expansion was primarily reflected in the sustained growth of new orders, which rose at the fastest pace in nearly one year. Improvements in overseas markets and increased tourism activity led to the highest growth in new export orders in 10 months, marking the eighth consecutive month of expansion.

The index in April was slightly lower than the March reading of 52.7, but it remained in expansion territory, mirroring the sustained pickup in both the supply and demand sides in services. 

The new orders index and new export orders index saw moderate increases in April, hitting their highest levels since June and July 2023. 

“Improved demand drove a continuous increase in supply. Business activity and total new orders both grew for the 16th straight month, with the latter increasing at the fastest pace since May last year, indicating a solid resurgence in demand,” Wang Zhe, a senior economist at Caixin Insight Group, said on Monday.

First-quarter economic conditions have exceeded market expectations, with consumption gradually picking up, signaling a positive start to the year. 

Analysts expect the economy to ride on the momentum of the good start to the year, with more driving force from brisk services activity and consumption in the remaining months.

“The sustained expansion of the services PMI reflects the stability of China’s economic development, symbolizing the leading role of the services sector in the country’s economic recovery,” Li Chang’an, a professor at the Academy of China Open Economy Studies of the University of International Business and Economics, told the Global Times on Monday.

This is a significant outcome of policies aimed at boosting domestic demand and stimulating consumption, and the expansion of the tertiary sector is likely to continue, said Li. 

According to the Ministry of Culture and Tourism, during the five-day May Day holidays, 295 million domestic trips were made, a 7.6 percent year-on-year increase and a 28.2 percent gain compared with the 2019 figure. Total domestic tourist spending reached 166.89 trillion yuan ($23.13 billion), up 12.7 percent year-on-year and a 13.5 percent increase compared with 2019.

However, some economic pressure persists. According to data from Caixin, the services sector employment index remained in contraction territory for a third consecutive month.

“Despite optimistic macroeconomic data driven by policy efforts, the economic recovery will take time,” Chen Fengying, an economist and former director of the Institute of World Economic Studies at the China Institutes of Contemporary International Relations, told the Global Times on Monday.

Global Times

E-commerce and delivery services see major development in China’s Xinjiang

An intermodal express train loaded with containers of e-commerce goods departs from Xi'an international port station in Xi'an, northwest China's Shaanxi Province, March 26, 2024. The intermodal express train X387 bound for Urumqi in northwest China's Xinjiang left Xi'an on Tuesday, marking the official operation of regular freight train service for e-commerce goods between the two cities.(Photo: Xinhua)

An intermodal express train loaded with containers of e-commerce goods departs from Xi’an international port station in Xi’an, northwest China’s Shaanxi Province, March 26, 2024. The intermodal express train X387 bound for Urumqi in northwest China’s Xinjiang left Xi’an on Tuesday, marking the official operation of regular freight train service for e-commerce goods between the two cities.(Photo: Xinhua)

China is making an effort to enhance e-commerce and express delivery services across the country, with a focus on remote regions. In Northwest China’s Xinjiang Uygur Autonomous Region, major Chinese online shopping platforms have initiated new measures to facilitate delivery services in the area.

Notably, Pinduoduo rolled out free express delivery services into villages across Xinjiang in March, covering more than 10 product categories and over half of Xinjiang’s villages. STO Express, in collaboration with Taotian Group, began a pilot free shipping program on March 16, making over 10 million products eligible for free shipping in the area.

Historically, Xinjiang’s relatively isolated location has led to challenges including high postage fees, lengthy delivery time, and the exclusion from free delivery services of online shopping platforms.

In March, China’s Ministry of Commerce, along with other departments, released a notice on promoting the high-quality development of rural e-commerce, calling for an enhancement of logistics and distribution systems in rural areas. This notice includes developing modern rural logistics facilities, increasing the intensity of rural logistics distribution, and fostering innovative development in rural commercial logistics.

These initiatives have pushed the expansion of express delivery and e-commerce in remote areas, including rural areas. With Xinjiang’s economic growth accelerating, there has been an increasing demand for e-commerce delivery services, highlighting the need for free shipping and faster postal services.

An official from the State Post Bureau highlighted the substantial progress made in Xinjiang’s e-commerce and delivery services. “Currently, there has been a significant improvement in Xinjiang’s e-commerce courier services,” the official noted, pointing out that since September of the 2023, the daily average volume of parcels delivered across Xinjiang has surged by nearly a million, The People’s Daily reported on Tuesday.

According to the postal bureau of Xinjiang, increasingly fewer merchants are rejecting shipping goods to the area, the percentage decreased from 10.17 percent in September last year to present 0.83 percent. Additionally, 73.39 percent of surveyed users in Xinjiang saw improvements in shipping services, with 31.96 percent finding the improvements to be significant, as reported by The People’s Daily on Tuesday.

In 2023, Xinjiang’s total retail sales of social consumer goods increased by 18.8 percent, reaching a historic high, with online retail sales growing by 23.7 percent. Data from the State Post Bureau showed that Xinjiang’s courier service volume grew 88.1 percent in 2023, with revenues seeing a year-on-year increase of 77.9 percent.