In China, a younger generation of consumers has taken center stage due to an increase in purchasing power. Most of them, however, are buying on credit. While experts think a boost in demand is good, they're also calling for healthy and sustainable spending habits. Dai Kaiyi has this report.

Fresh out of college, 24-year-old Ling Yitong loves to shop. But she says she's usually in debt at the end of each month, after spending sprees fueled by two credit cards and some virtual credit providers.

LING YITONG Consumer "I pretty much use my credit card for all my expenses, which I don't need to pay for until the following month."

Ling Yitong works at a sports agency in Beijing. It's her first job, where she says she earns a decent pay.

LING YITONG Consumer "The way I perceive my finances is very different from my parents. They live a more frugal life. But I think being able to spend helps improve one's quality of life, especially if you have money at your disposal."

And many young Chinese share Yitong's point of view.

According to a 2019 Nielsen Consumer report, more than 86 percent of young people in China are using credit products.

WANG ZHICHENG Associate Professor of Finance Guanghua School of Management, Peking University "People born in the 1990s and 2000s are more impulsive shoppers because the majority of them are the only children in the family. Nevertheless, China's production capacity has lived up to the demands of the growing population."

Looking back, Professor Wang says China's economy was always driven by investment. Consumption would sometimes contribute to less than half of the country's gross domestic product, or GDP.

This is why more young adults who are happier about spending money fit into the bigger picture of China's consumption upgrade strategy.

WANG ZHICHENG Associate Professor of Finance Guanghua School of Management, Peking University "Basically, consumption should be a key engine for growth. Upgrading consumption, in essence, is about optimization. It's about effectively and reasonably utilizing resources, and making fine products instead of churning out low-quality ones."

DAI KAIYI Beijing "Aside from a more efficient distribution of resources, some experts believe domestic spending will drive the economy forward for the better. But for China's consumption upgrade to work in practice, they say people need to be rational and think twice before spending their money, especially on credit. Dai Kaiyi, CGTN, Beijing."

source：China's Consumption Upgrade: Experts urge sustainable spending habits among youth
CGTN 02-Feb-2021