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10 Oct, 2013

Chinese anti-corruption drive cools holiday gift market


NANJING, 2013-10-04, (Xinhua) – Holiday season used to be boom time for gift companies in China, but the country’s frugality campaign is meaning many of them will have a hard time surviving this time around.

In the eastern Chinese city of Suzhou, where people swarm during Mid-Autumn Festival and the National Day holiday to buy Yangcheng Lake crabs, a luxurious delicacy that always serves as the best holiday gift for government officials, crab sellers are worried they will not attract enough customers this year.

Zhou Xuelong, owner of a crab breeding company, said revenue this year is expected to drop by 10 percent as far fewer government units plan to purchase expensive crabs.

“In the past, even a government department of a small western city would place an order worth 100,000 yuan ($16,350), but this year old customers told me in advance they will not buy any crabs,” said Zhou.

His company is simplifying crab packaging, opening online shops, and promoting its products among ordinary citizens in second- or third-tier cities.

Meanwhile, restaurants in Suzhou are trying to make their traditional “crab feasts” affordable to normal people by offering versions that use crabs weighing 100 to 150 grams each as food material.

In the past, restaurants would offer crabs weighing 250 to 300 grams each and crab feasts priced at more than 10,000 yuan.

Chinese people put a high value on social contact. Holidays have always been considered the proper time to nurture relationships and bond with old and new friends, as well as cozying up to the leaders of government bodies, which propped up the gift-giving market.

This year, however, disciplinary departments have been urged to tighten supervision and enforcement of discipline to reduce corruption. Practices such as the use of public funds to buy gifts, hold banquets and pay for holidays, as well as extravagance and waste, have been strictly banned.

Along with the crab market, tea, high-end wine and mooncake markets have also been hit by the nationwide anti-corruption activities.


Nevertheless, the old belief in gift-giving persists and people have resorted to handing out gifts more covertly.

Sales of shopping vouchers have been spectacular. A mall in downtown Nanjing, capital of east China’s Jiangsu Province, has received 137 customers buying vouchers worth 500 or 1,000 yuan each and asking for office supply invoices.

A female customer bought more than 20 cards worth 1,000 yuan each and took the invoice back to her company for reimbursement.

Business has likewise been dynamic for second-hand shops that buy unwanted gifts from people at relatively low prices and sell them for a profit.

“We have opened an online shop and offer door-to-door service so that our customers won’t be afraid to be spotted,” said a member of staff at a second-hand gift shop on Hunan Road, an important business district in Nanjing.


Social scientists said the cooling of the gift market has proved the success of the government’s anti-corruption initiatives, but stressed that fighting corruption is still a long-term task.

Only by perfecting a long-term mechanism in guarding against and punishing corrupt behavior can we have a clean government, said Wang Shiyi, director of the research center on clean politics education with the Party School of the Communist Party of China’s Jiangsu Provincial Committee.

Wang added that the government has to carry out administrative reforms, function more transparently, and accept the general public’s supervision so that corrupt officials will have nowhere to hide.

For gift companies, it will take time for them to reposition themselves to meet market needs.

“We have opened more than 80 stores to broaden sales channels and to be close to the ordinary people, but we don’t expect overnight success,” said Zhu Yuhua, chairman assistant of Shanghai Hanfu Industrial Development Co., Ltd..

Zhu said the company made such changes because they felt the central government is determined to fight corruption.