Across China,communist party officials are handing out millions of food,shopping,and cinema coupons in an effort to get people to go out,have a good time and spend,spend,spend.
Chinese people are among the world’s most determined savers,with economists estimating they put away 30 to 40 per cent of their disposable income,but a virtue can be an obstacle when trying to jump-start the economy.
So while multi-billion-dollar spending programmes on infrastructure projects and interest rate cuts have stolen the headlines in China in recent months,the humble coupon has quietly emerged as another popular stimulus weapon.
Chengdu,the capital of quake-hit Sichuan province,was one of the early coupon pioneers,giving more than 379,000 low-income residents nearly 39 million yuan worth of vouchers in December.
The eastern city of Hangzhou also last month gave 670,000 low-income residents 100 million yuan (USD 14.6 million) in vouchers to spend in shops and entertainment centres.
“The principle of putting money in people’s pockets has been applied literally,” Jing Ulrich,JP Morgan’s head of China equities mused in a research note.
“Consumption coupons could become more common as an alternative to income tax cuts which might only encourage greater savings,” she wrote.