Connect with us

Business

Why China’s cities will drive global growth

Published

on

Urban Chinese population growth, as well as increases in urban incomes, and urban consumer spending is expected to drive growth, write Chang Ka Mun, and Jaana Remes, in Project Syndicate

For 15 years, China has been a key engine of global growth. But now that China’s investment-led boom has run its course, continued economic growth – in China and globally – will depend on urban Chinese consumers.By 2030, people living in cities will drive 91% of global growth in consumption, and China is emphasizing both urbanization and a consumer-led growth model.The McKinsey Global Institute’s latest research is optimistic that China’s strategy will succeed. MGI (where one of us is a partner) foresees continued growth in the number and income of urban consumers, and predicts that 700 Chinese cities will generate $7 trillion, or 30%, of global urban consumption growth between now and 2030.

Today, China’s urban working-age consumers number 521 million; in just 15 years, their ranks will have swollen to 628 million. Beijing, Guangzhou, Shanghai, and Shenzhen will each add more than one million households with annual income above $70,000 – the number of Hong Kong households in that income bracket today. Per capita spending is set to jump from $4,800 to $10,700 by 2030, at which point this group will spend 12 cents of every $1 of urban consumption worldwide.

Urban incomes in China are now reaching a threshold where spending on both goods and services accelerates rapidly. Annual household spending on personal products and on dining out will more than double, to $770 and $720, respectively. Chinese consumers are also traveling more, with the China Outbound Tourism Research Institute predicting that more than 100 million Chinese will travel abroad by 2020.

China’s new consumer army will have the means and, more important, the willingness to spend its higher earnings. According to McKinsey’s 2016 Global…

Read the complete story Here

Continue Reading
Click to comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Top Posts

Recents

United States2 weeks ago

Huawei Sues the U.S. for Restricting Business With Federal Agencies

China1 month ago

Chinese investors spent $2.3 bln in Thai property in 2018

Chinese investors have continued pouring their money into Thailand’s property sector even as the kingdom barrels toward an uncertain national election. See author's...

China4 months ago

US–China trade war : will there be a winner ?

The U.S. and China are hours away from a new round of tariffs on each other’s goods, with no improvement...

Economics4 months ago

Trumping financial risks in Asia

Twenty years after the Asian financial crisis of 1997–98 and the global financial crisis of 2007–08, storm clouds are gathering...

Companies4 months ago

Thai Startup Event Banana

Event banana, a Thai start-up based on event venues and its online marketplace, has recently been able to raise about...

Business5 months ago

营商环境报告:东亚经济体继续大力推进改革议程改善营商环境

世界银行集团今天发布的《2019年营商环境报告:强化培训,促进改革》称,东亚太平洋地区各经济体继续大力推进改革议程,在过去一年里实施了43项改革以改善中小企业的营商便利度。 bsullivan See author's posts Related

News6 months ago

What are US-China Trade War Implications for Thailand ?

What are the implications of a US-China for Thailand? Will the economy be hit by global market disruption? Or could...

China6 months ago

China dominates Asian Economies

China, world’s second-largest economy stands tall with US$ 25.3 trillion and is up by 9% from 2017 followed by India...