As China seeks to shore up its faltering economy, officials are rewarding citizens with travel discounts and offering companies cheaper loans — but only for the best behaved.

China’s Ministry of Culture and Tourism has announced plans to widen a pilot injecting stimulus into the tourism sector still in its nascent post-Covid recovery, using a controversial social credit system that rewards good deeds and punishes misbehavior.

The extended pilot builds on a recently concluded program spanning a dozen districts and cities that relied on various municipal or sector-specific credit scores.

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In the eastern city of Wenzhou and three counties in Shandong province, people assigned with good credit scores from municipal authorities can redeem free tickets to local and regional tourist attractions.

Tourism companies with good scores are also being rewarded. In the Huangpu district of Shanghai, where tourism revenue plunged 37% in 2022 from a year earlier, more trustworthy enterprises can get loans at half the standard interest rate. In Rizhao, a coastal city in Shandong, tourism agencies with a sound track record can take part in “travel first, pay later” tours.

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Signs of the Chinese economy losing momentum in its recovery after three years of Covid isolation are mounting. While the past Labor Day holiday saw many Chinese swarming to popular scenic spots in a travel boom that exceeded pre-pandemic levels, their spending was much more subdued, especially among the country’s youth who are facing record high unemployment.

--With assistance from Jenni Marsh.