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Why Chinas Consumer Slowdown Is Squeezing Small Manufacturers
Description
Episode 66 of China Economy with Fexingo examines how the gap between China's export boom and domestic spending weakness is squeezing small and mid-sized manufacturers. Lucas and Luna unpack May 2026 retail sales data showing a 0.8% year-over-year decline, the role of a weakening yuan at 6.76 per dollar, and how factory towns reliant on domestic orders are struggling even as exporters thrive. They focus on the city of Yiwu as a case study, where small household-goods producers report 15% revenue drops while export-oriented firms see 8% gains. The hosts also explore how provincial governments are stepping in with targeted consumption vouchers and delayed tax payments, and whether these measures can bridge the gap before the crucial Golden Week holiday in October. A specific, numbers-driven look at the real economy beneath China's headline growth.