(Yicai Global) April 23 -- Shanghai, which spentUSD190.7 billion on consumer goods last year, aims to encourage shoppers to splurge again after the coronavirus lockdown by staging a massive retail extravaganza from this month until June.

Thousands of businesses will take part in the event, which is being called the May 5th Shopping Festival, city officials said at a news conference today. It will feature more than 700 special events and discounts of at least 50 percent.

Consumer confidence in China’s biggest city fell in the first three months of this year, dropping 2.7 points from the final quarter of 2019, according to the findings of a quarterly survey conducted by the Shanghai University of Finance and Economics. But at 117.3 points, the index was still in positive territory.

“Events like the May 5th Shopping Festival will effectively enrich the entire economic chain,” Wang Sizheng, chairman of the Shanghai Institute of Macroeconomics, told Yicai Global, adding that discounts and other measures can help to shift lead to stocks due to the epidemic.

The sectors lined up for promotion are emerging consumption (online consumption), leisure, cultural tourism and catering, autos, and home decoration, according to Hua Yuan, director of the Shanghai Municipal Commission of Commerce.

Shanghai will also develop a tax-free economy, and encourage the opening of more duty-free shops in downtown and set up domestic product sales areas in these outlets, officials said. The city’s sales of departure tax rebate products accounts for 60 percent of the entire country’s, and airport duty-free shop sales ranked first in China and third in the world.

As consumers have developed online shopping habits during the epidemic, the May 5th Shopping Festival needs to better link online and offline consumption, and help stimulate consumer demand that has been suppressed due to the coronavirus, said Liu Gongrun, researcher and director assistant of CEIBS Lujiazui Institute of International Finance.

According to Hua, Shanghai’s total retail sales of consumer goods reached CNY1.35 trillion (USD190.7 billion) last year, ranking first in China for the third consecutive year. Last year, the city’s e-commerce transactions exceeded CNY3.3 trillion, an increase of 14.7 percent and making up about one-10th of the country.

Imports of clothing, cosmetics, and automobile via Shanghai ports accounted for 69.9 percent, 47.3 percent and 36.3 percent of the country’s total, respectively, Hua said. The city is now the first choice for international brands to enter China.

Editors: Zhang Yushuo, Peter Thomas