New lottery scheme, discount packs: China makes $374m push to boost Chinese New Year spending

SINGAPORE – China has launched a major campaign to encourage more consumer spending over the upcoming nine-day Chinese New Year holiday, in its latest bid to boost flagging domestic consumption amid a slowing economy.

About 2.05 billion yuan (S$374 million) has already been allocated by local governments to the consumption push during this holiday season, known as the Spring Festival in China.

The campaign includes the distribution of vouchers, subsidies and cash incentives in the form of red packets, Vice-Minister of Commerce Sheng Qiuping said during a media briefing on Feb 11, the transcript of which was posted online.

It comes as China at a key annual policy meeting in December 2025 made boosting domestic demand – household consumption in particular – its top economic priority for a second year running.

Described by Mr Sheng as a national effort involving multiple government departments and dozens of national business associations, the campaign is expected to have multiplier effects, though analysts say its effectiveness could be limited due to China’s broader economic challenges.

The main event is a new lottery that will be held in 50 cities, for a start. Anyone who obtains invoices with a face value of 100 yuan or more from shopping, dining, tourism or accommodation in these cities will be eligible to participate.

More than one billion yuan in prize money will be given out during the nine-day break alone, with plans to increase the prize pool to 10 billion yuan over a broader six-month implementation period, Mr Sheng said. According to state-owned broadcaster CGTN, the maximum prize for the invoice lottery is 800 yuan.

Other measures include financial support to businesses for promotional offers on a range of holiday goods and services, such as air tickets, hotel stays, meals and tickets to tourist attractions.

The Ministry of Commerce will also guide local governments to increase the disbursement of 62.5 billion yuan in national subsidies over the nine-day public holiday.

This sum is the latest tranche of funds that have been allocated to a trade-in programme introduced in 2024 to encourage spending on big-ticket consumer products such as large household appliances and cars. Announced in January, the new funds have since been distributed to commerce departments in various regions.

Kicking off on Feb 15, China’s Spring Festival is traditionally a peak period for consumption as millions travel across the country for family gatherings, buy gifts and spend money on meals and entertainment during the extended break.

At nine days, the Spring Festival holiday in 2026 will be the longest on record. The Chinese authorities expect 9.5 billion trips to be made during the 40-day period around the festival, surpassing the record 9.02 billion trips made in 2025.

Mr Sheng said the Ministry of Commerce, along with other central government departments and local administrations, will help to ensure a smooth supply of goods and services, as well as smooth journeys for those travelling, during the festive season.

For instance, tens of thousands of petrol stations will provide free hot water, emergency medicine and discounted car washes, while popular cultural attractions and museums will extend their opening hours.

For foreigners visiting China, steps are being taken to improve the convenience of digital services, including mobile payments.

Mr Sheng said tourists will also be offered the equivalent of a 10 per cent discount at 13,000 shops nationwide that provide tax refunds.

The latest offensive by Beijing to drive up spending at home comes on the back of slowing economic growth. China grew by 4.5 per cent in the last three months of 2025 compared with the same period a year earlier – its weakest pace since early 2023.

While a surge in exports helped China to meet its goal of 5 per cent gross domestic product (GDP) growth in 2025, weak consumer sentiment amid a long-drawn property slump has been a drag on the economy.

Observers expect Beijing to set out plans for more balanced economic growth in its 15th Five-Year Plan which will be released in March and will chart the country’s economic and social development strategy from 2026 to 2030.

Ms Guo Shan, a partner at Shanghai-based consultancy Hutong Research, said the Spring Festival spending drive is another sign of Beijing’s determination to boost domestic demand, and she expects the government to mount similar campaigns over the next five years.

“Past policies to drive domestic consumption are having a diminishing impact, which is why such new measures are needed,” she said.

Ms Guo, who focuses on Chinese economic policy, said the new 10 billion yuan lottery could have the most impact as it taps new demand.

The scheme will also benefit the service sector, which employs more than 60 per cent of China’s workforce, and offers an emotional reward that could improve consumer sentiment and lead to more long-lasting behavioural change, she added.

Still, without other measures to encourage more borrowing by Chinese consumers and improve their spending power, the new Spring Festival campaign will likely boost consumption only at the margins, the analyst said.

Ms Guo added: “Overall, we still expect China’s consumption to stay soft until the economy and job market recovers.”