China's E-Commerce Logistics Index Reaches New High Of 112.0 Points In July Amid Strong Domestic Demand

China's e-commerce logistics index reached 112.0 points in July, marking a 0.2-point increase from June. This rise reflects the effectiveness of government policies aimed at boosting domestic demand, according to industry data. The China Federation of Logistics and Purchasing (CFLP) reported that the sub-index for gross business revenues also saw a slight month-on-month increase to 130.9 points.

The government's trade-in program, launched last year, has significantly boosted domestic consumption and driven industrial transformation. In July, the National Development and Reform Commission announced that 138 billion yuan would be distributed in the third and fourth quarters to support local governments in implementing this program. These measures have strengthened consumer confidence and enthusiasm, particularly during the summer consumption wave.

He Hui, Chief Economist at CFLP, noted that July's figures indicate strong performance during an off-season period. Business volume recovery has improved load utilisation rates while reducing logistics costs. "The recovery in transaction volume has driven up the load utilisation rate index while simultaneously contributing to reduced logistics costs," He Hui told Global Times.

Extreme summer weather has driven sales of medical products, sun protection creams, and off-season clothing. Educational materials and training courses themed around summer vacations have also seen significant growth. Cai Wei, Chief Strategy Officer at KPMG China Advisory, stated that as policies continue to stabilize employment and boost consumption, service consumption and new types of consumption are expanding.

The trade-in policy is increasingly guiding green and intelligent consumption upgrades. New energy vehicles, energy-saving appliances, and smart home devices are experiencing rapid growth. Additionally, emotion-driven purchases are boosting categories like light luxury items, trendy toys, and fitness products.

Retail Sales Growth

China's retail sales of consumer goods rose by 5 percent year-on-year in the first half of this year. Online retail sales increased by 8.5 percent over the same period, according to official data. These figures underscore the resilience of China's consumption sector as a key driver of economic growth.

Cai Wei highlighted that gold and silver jewellery along with sports and entertainment products are achieving rapid growth due to this evolving consumer landscape. "China's consumption is poised to maintain resilience and will serve as the primary driving force for economic growth," Cai Wei told Global Times.

With inputs from WAM