Chart of the Day: For China’s Online Sellers, Covid-19 Quarantines Have Been Great for Business

China’s online retail sales continued to grow last year, albeit at a slower pace, as quarantine measures during the Covid-19 epidemic boosted online shopping activity.

In 2020, online retail sales of physical goods in China rose 14.8% year-on-year to 9.8 trillion yuan ($1.5 trillion), down from 19.5% growth the previous year, according to data (link in Chinese) released by the National Bureau of Statistics on Monday. China has now been the world’s largest online retail market for eight years in a row, a spokesperson of the Ministry of Commerce told (link in Chinese) state-run Xinhua News Agency.

China’s total online retail sales, including goods and services, rose 10.9% year-on-year to 11.8 trillion yuan last year, the data showed. The country’s retail sales, however, shrank 3.9% in 2020 from the previous year.

China is on track to take over the U.S. as the world’s largest retail market. But the gap has widened in the past two years due to China-U.S. trade friction and disruption resulting from the pandemic, economists at Jingdong Digits Technology Holding Co. Ltd. said in a research report.

The U.S. government focused its fiscal stimulus on boosting household consumption, while China paid more attention to supporting factories and businesses, the economists said.

China’s GDP grew 2.3% last year, likely becoming the only major economy to manage an expansion for the year. Backed by a resilient economic recovery and a low base effect in 2020, China is expected to become the largest retail market in the world this year, the economists said.

Contact reporter Tang Ziyi (ziyitang@caixin.com) and editor Michael Bellart (michaelbellart@caixin.com)

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