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Less Price Control : Buy, Enjoy Is New Ethic for Chinese

November 26, 1986|JIM MANN | Times Staff Writer

PEKING — It is a typical Thursday night in the Yueyou (Happy Friend bar and cafe) in the center of Peking. Stevie Wonder's "I Just Called to Say I Love You" is playing in the background, and all the tables and booths are occupied.

The crowd is entirely Chinese. Many are well-dressed young professionals. Some of them have wandered in from the concert hall next door. They are doing something their parents' generation never would have dreamed of doing--blowing a bit of their own money on beer, wine and night life.

A few blocks away, in the state-owned Modern Times cocktail lounge, He Wenzhong, a well-tailored official at Radio Peking, sips from his can of Japanese Asahi beer and explains his philosophy of finance: "When you put money in the bank, you get nothing. When you spend it, you enjoy life. People are working harder now, and they want to enjoy life."

Stems From Reforms

Such feelings are an outgrowth of China's ongoing economic reforms. The gradual lifting of price controls in China and the continuing inflation that has accompanied it have brought in their wake the first stirrings of a consumer society in the world's most populous nation.

Old notions of thrift and austerity are being cast aside. Not only common street wisdom, but some of China's most prominent economists are spreading the notion that spending money is not such a bad thing.

"The concept of consumption should be changed," Li Yining, a Peking University economics professor, said in an interview with the government-run newspaper China Youth News last summer. "Consumption that does not exceed the limits of one's income, even if it is consumption for high-grade commodities, should not be regarded as extravagance."

TV Sales Up 50%

The Chinese, particularly young Chinese, are heeding the advice. This year, the signs of consumerism are everywhere.

Sales of color television sets were up by 50% for the first half of 1986 over the same period a year ago, and sales of refrigerators were up by 45%. Chinese department stores have also put a few video recorders on display. Their prices are so high that the VCRs are often bought in the name of Chinese enterprises, not by individuals.

A few years ago, foreigners stationed in China were asked to buy basic items in short supply, such as cooking oil or beer, for their Chinese friends. Now, it is not uncommon for a new request to be added to the list: a loan of videotapes.

Over the last few months, more and more young Chinese women in major cities have begun to wear lipstick, makeup, shoes with narrow high heels and Hong Kong-style fashions. For Chinese men, the sign of status is a Western-style wool sports jacket or suit.

Lines at Counters

At the Xidan department store, one of the largest in Peking, big crowds now line up at the cosmetics counters.

On a recent Saturday, Xi Huirong, a Peking office worker, stood at the counter examining a special new da bao (big protection) quick-remove wrinkle cream. "I'll try it," she said after hesitating for a moment.

Three jars cost 6.7 yuan ($1.80), roughly a quarter of a week's wages, but her husband raised no objection. The saleswoman, Zhang Chengmei, said she now sells 600 jars of the cream each day.

Allows More Choice

For the time being, at least, the Chinese regime has decided to tolerate the national splurge on fashion and cosmetics. This year, a signed article in the People's Daily, the official Communist Party newspaper, said that whatever people choose to wear is a private matter, unrelated to politics.

Not everyone in China is able to take part in the new consumer boom.

According to official figures, approximately 5% of China's urban population of 200 million people are living in poverty. The average per capita income in Chinese cities is $17 a month, but, for these 10 million urban poor, the average per capita income is less than $9 a month.

Poor 'Badly Hurt'

"They have been badly hurt by the increase in living expenses in the last couple of years," the newspaper China Daily reported last week.

In September, Song Tingming, an economic adviser to Premier Zhao Ziyang, estimated that, in the Chinese countryside, about 50 million to 60 million of China's 800 million peasants are living in such poverty that they lack sufficient food, clothing and shelter.

"That's as much as the population of Britain or France," Song said.

Nevertheless, in both rural and urban areas, the majority of Chinese over the last couple of years have been buying goods and spending money as never before.

China's buying spree dates to the fall of 1984, when the Communist Party adopted a package of market-oriented economic reforms for urban areas. As part of the program, the party announced that it would begin to lift price controls on many items and let prices be determined by forces of supply and demand.

Anticipating Price Rises

In anticipation of price rises, Chinese families rushed to stock up on food and began buying consumer goods such as television sets and refrigerators in unprecedented numbers.

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