Spending Reports: Are We Even Poorer Than Mexico?

Everyone, let’s talk about consumer spending this time. A colleague told me, “Did you know? Our per capita GDP is on par with Mexico’s, but our consumption is less than half of theirs.” I was taken aback—are Mexicans really that wealthy? I looked it up when I got home, and it’s true. In 2023, China’s per capita final consumption was $4,936, while Mexico’s was $9,688—it really is exactly half. And don’t even get me started on comparisons with developed countries: France at $24,000, Germany at $27,000, and the U.S., where per capita consumption tops out at over $56,000. Ten times what we spend—what does “ten times” even mean? Are we really that poor? So I recalculated using purchasing power parity (PPP): China’s per capita consumption came out to $9,586, while the U.S. remained at $56,000. This shows that our goods are sold cheaply, leading to an underestimation of our consumption. After the PPP adjustment, Mexico’s consumption actually rose to 16,000—still a good deal higher than ours. This isn’t about catching up to or surpassing the UK or the U.S.; it’s about catching up to Mexico first. But when I looked at it this way, it still didn’t quite match my personal experience. I then came across a report from the China Financial 40 Forum that offered an interesting perspective: consumption shouldn’t be measured by how much money is spent, but by how much is acquired—how much one eats, how much one wears, what kind of cell phone one uses, what kind of car one drives, and how big one’s house is. We should select key indicators across all aspects of daily life—food, clothing, housing, and transportation—to make a side-by-side comparison. Let’s start with food. Dietary habits vary greatly from country to country, so how do we compare them? Two metrics: per capita calorie intake and protein intake—that is, energy and nutrition, or simply put, whether people are well-fed or well-nourished. We can directly compare the results. In terms of calories, China’s per capita daily intake rose from 1,400 kcal in 1961 to 3,453 kcal in 2022. It surpassed Mexico as early as 2013 and is now actually on par with developed countries. France stands at 3,500, Germany at 3,600, and the U.S. eats a bit more at 3,900; as for the Japanese, they really do eat very little—not even 2,700. In terms of protein, China’s per capita intake rose from 40 grams per day in 1961 to 128.5 grams in 2022. This level far outpaces all other countries—even those we typically think of as heavy consumers of meat, eggs, and dairy: Germany at 107.4 grams, the United States at 121.6 grams, and Japan at less than 100 grams. How was this achieved? China is an agricultural powerhouse; food prices are inherently low, and the diet is relatively balanced, with a significant portion of plant-based protein coming from soy products. In other words, when it comes to diet, there’s actually no significant gap between China and developed countries. Now let’s compare clothing purchases. The average Chinese person buys about 22 pieces of clothing per year (I suspect socks are included in that count—I certainly haven’t bought 22 pairs myself), and two pairs of shoes annually. This is roughly on par with Mexico, where the figures are 26.2 pieces of clothing and 1.8 pairs of shoes. The U.S. figures are rather extreme, at 90 garments and 6 pairs of shoes per year. France, Germany, and Japan all have higher figures than China but lower than the U.S., falling somewhere between the two—let’s take the average. As for cars, China’s 2023 consumption rate was equivalent to 22 cars per 1,000 people—twice that of Mexico, roughly 60% of Europe’s, and less than half of the U.S.’s. We lag a bit in this area. Housing is divided into two categories: per capita floor area and per capita number of housing units. Official statistics only track per capita floor area; for the urban population, it stands at 38.8 square meters, which is essentially the same as Mexico’s 39.6 square meters. Japan’s figure is higher at 45.8 square meters, while the U.S. stands at 62.9 square meters. However, these figures compare urban populations only; if rural housing area were included, the gap would be somewhat smaller. The number of housing units per capita can be estimated from commercial real estate transaction data, standing at 0.387 units per person. France has the highest figure at 0.591 units, followed by the United States at 0.428 units; China has reached approximately 90% of the U.S. level. Of course, this count treats any space with a ceiling as a separate unit, so comparing large houses to small apartments is somewhat of a forced comparison. Beyond basic living needs, in terms of service consumption—including education, entertainment, healthcare, and tourism—China’s gap with developed countries is not significant when measured by quantitative indicators. Our average years of education stand at 15.2 years, which is comparable to Japan’s and higher than the U.S.’s 14.5 years, though still two years short of Germany’s 17.3 years. When it comes to healthcare, life expectancy per capita is a good indicator of the quality of medical services. Our upward trend is converging with that of developed countries—our life expectancy is 78.37 years, compared to 79.61 years in the U.S. and 85 years in Japan. With some effort, we can catch up; after all, Hong Kong ranks first globally at 85.77 years. In terms of travel, domestic travel averages four trips per person per year, compared to about seven in the U.S.; for international travel, our rate is 0.14—meaning only one out of every 10 people travels abroad once a year. While this is lower than the U.S. rate of 0.5, the gap is narrowing compared to the Japanese, who used to be particularly fond of traveling abroad—their rate is 0.16. To summarize: if we compare total spending amounts, we are indeed quite low; but when comparing actual consumption—which is more outcome-oriented—our per capita consumption level is far higher than Mexico’s, not half of it. This indicates that internationally accepted statistical methods systematically underestimate consumption due to factors such as price levels and exchange rates, so we need to find more scientific methods. Our consumption levels aren’t low in terms of quantity, and the range of consumption is fairly comprehensive, but there is still room for improvement in terms of quality. One final point is particularly crucial: our consumption levels are an objective reality; no matter how the statistics are calculated, they will not alter the fact that increased exports lead to a trade surplus. Therefore, stimulating domestic demand is not about arbitrarily inventing new consumption drivers, but rather about improving quality and raising the standard of living for ordinary people. This will also help alleviate structural imbalances in global trade and improve our external environment. I’m so hungry—I’m going to start eating now and make a small contribution toward catching up with Mexico.