New: You can now listen to articles.BEIJING: Living in Beijing, where “allergens are flying around”, 26-year-old Yao Yao is very particular about her cosmetics — they must protect her skin.
But it is not just a swell of patriotism that spurs Chinese consumers to opt for home-grown products over foreign ones. They prioritise domestic brands for the affordability and quality too, indicated aFor avid mobile gamer Lei Dongsheng, 24, who switched from Apple to Xiaomi in 2012, the Chinese smartphone brand’s “price-to-performance ratio is relatively higher than other brands, and the experience after using it is also good”, he cited.
Compounding the issue, the real estate sector serves as the main revenue stream for local governments, with leases typically spanning 70 years and generating significant income for authorities. Lim observed that despite generally stable prices and even some cases of deflation in China, it was prudent for the average consumer to save now and capitalise on future price cuts.“Increased economic uncertainty also increases, in Chinese consumers, a willingness to save,” he added. “They’re less likely to open their wallets to spend on new products and services.”
These nationalistic sentiments can serve as a trump card in bolstering local economies, industries and brands, particularly in competition with foreign counterparts, said Chen Gang, the deputy director of the National University of Singapore’s East Asian Institute.Such is the strength of this pride that foreign brands risk severe criticism if they offend Chinese national sentiments.
In March, a Wall Street Journal report exposed Document 79, a state directive for Chinese entities to replace foreign technology with domestically developed alternatives and to prioritise innovation-driven development by 2027. Over the past decade, domestic brands have expanded their market share across various sectors, from mobile phones to infant formula to fast food restaurants, according to Euromonitor.What impact will economic nationalism have, however, on foreign companies? After all, through its investments in domestic industries, China risks alienating foreign firms who are already losing market share to local competitors.