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Shenzhen, Guangzhou, and Xiong’an New Area announced they are distributing free digital yuan “red packets” to boost local consumption amid China’s economic slowdown fueled by mass Covid lockdowns.
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Fast facts
- Shenzhen will give out 30 million digital yuan (US$4.5 million) starting Thursday, through a lottery system that gives residents chances to win 88, 100, and 128 yuan red packets.
- In many Asian nations including China, red packets are monetary gifts in red envelopes that are given during special occasions, but for China’s central bank digital currency (CBDC), also known as the e-CNY, they are distributed in the form of digital coupons.
- The Nansha District in Guangzhou said last Wednesday that it will give out 10 million in digital yuan red packets to boost catering and retail industries, but hasn’t announced the date of issue yet.
- Xiong’an New Area, a special economic zone southwest of Beijing, started distributing red packets on Monday as a part of its 50 million yuan plan to boost consumption, local media reported.
- The Caixin Purchasing Managers’ Index (Caixin PMI) dropped to 36.2 in April amid mass lockdowns in response to the Covid outbreak, which is the weakest performance for China’s service sector in more than two years.
- Chinese Premier Li Keqiang called for provincial, municipal and rural leaders to speed up infrastructure projects, boost jobs and restore growth, in a nationwide video conference last Thursday.
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