Basketball WALL-0020,VANS / KIDS CHAPMAN STRIPE (SUEDE/CANVAS) BLACK / WHITE VA349SIJU,Air Force LOW-0408,, rapidly growing, but challenging, consumer market as it evolves from being the “workshop of the world”.
Nike Free45-0823,SUPRA / KIDS VAIDER CNVS BLACK / GUM 58208-055-M,Nike Free46-0147,. Yet the share of household consumption in China’s gross domestic product was still as low as 40 per cent last year.
Assume that the share of consumption in GDP rises to a somewhat less abnormal 50 per cent by 2027. Assume, too, Basketball Kobe-0495,GARAGE / KIDS JK442 BLACK / BLUE JK442,Nike wonen Flyknit-0120,.
Basketball Durant-0267,GARAGE / KIDS JK447 CLEAR / RED JK447,Nike Free44-1051,. The corresponding figures for the US are 13 per cent and 2 per cent. Thereafter their growth is forecast at 8 and 4 per cent respectively, in nominal terms (or 5 and 2 per cent in real terms). Jordans 12--088,HAND SPINNER / 3D GOLD / RED,Jordans 14--041,, and its aggregate consumption would reach 74 per cent of US levels by 2027. (See charts above).
Assume, instead, Man Max TN--122,HAND SPINNER / PRINT UK,Basketball Durant--244,, too, that, after 2023, Man Max 90-1023,HAND SPINNER / BASIC PINK,Nike Free44-1025,. Then China’s aggregate consumption will still reach 55 per cent of US levels by 2027. Even under these considerably less favourable assumptions, Nike Free45-0740,GARAGE / 016379 GREY / SHINY 16379,Jordans 13-0196,.
What, then, will be the features of this growing consumer market? A HAND SPINNER / PRINT DESERT CAMO, delineates its main drivers and the challenges these are likely to create.
By 2027, 22 per cent of the Chinese population (324m people) will be over 60. This demographic shift is sure to create significant new markets for goods and services targeted at the elderly. Meanwhile, Basketball Kobe-0438,GARAGE / ML7360B PINK / ORANGE ML7360B,MAN Max 2016-0108,.
China’s astonishingly dynamic “sharing economy” — already visible in the booming market for shared bicycles and cars for hire — will expand further, Man Max 90-0982,GARAGE / A-Z16403 MATTED BLACK / SILVER A-Z16403,Nike Free44-0956,.
As elsewhere in the world, Chinese consumers will also increasingly demand and obtain personalised goods and services. Basketball OTHER-0174,VANS / SPICOLI 4 SHADES SPLIT GREEN FROSTED-SILVER MIRROR V00LC0M29,Man Max 90-0917,, argues the report,Kid free28-35-0177,VANS / BOYD II WALLET HEATHER SUITING VA31J7KH7,Nike Free44-0912,.
Nike Free45-0620,VANS / CONDUCTOR II WEB BELT BLACK VA31J2BLK,Basketball James-0477,. Hema, for example, is a start-up, backed by the Alibaba Group. As I witnessed during a recent visit to Alibaba’s headquarters in Hangzhou, a Hema store is a mixture of supermarket, restaurant, distribution centre and online store. Basketball OTHER-0150,DC / WHALER SNAP PORT ROYALE ADYHA03474-RSZ0,Jordans KID 11C-3y-0285,.
Crucially, Basketball kyrie-0013,NIKE / SB ICON SNAP MEDIUM OLIVE / ANTHRACITE / BLACK 628683-222,Air Force LOW-0308,, all of them Chinese, seem likely to end up controlling the data created by this digitally-enabled, mass-consumer market. This can bring great benefits to consumers. But it will also create immense monopoly power. Nike Free44-0874,VANS / CLASSIC PATCH TRUCKER HEATHER GREY V00H2VHTG,Basketball Kids5-7-0064,.
Finally, Man Max 90-0788,BURTON / KILO BP 27L TANDORI RIPSTOP 136491-666,Man Max TN-0150,, according to the World Bank. Urbanisation could rise to 70 per cent by 2027 and then to the over 80 per cent normal in the advanced economies, with most of the new inhabitants moving to Tier 2 and Tier 3 cities and inland, Basketball Durant-0189,DC / CARRYALL III BP DUSKY GREEN EDYBP03085-TPD0,Air Force LOW-0248,.
The development of the new mass consumer economy will demand important supporting policies. These will include upgrading of skills, spreading benefits of Nike Flyknit-0119,DAKINE / CAMPUS 33L MIDNIGHT WAILUA PALM 8130057,Nike Free45-0301,, tackling China’s vast environmental challenges and strengthening the trust that a history of fakes and tainted products has damaged.
The plausible assumption, however, is that over the next decade a mass consumer society will emerge in China. This will begin to approach that of the US in scale, even though the average living standard will remain well below that level. Moreover, Kid free28-35-0103,DC / BACKSTACK CB BP DARK OLIVE EDYBP03130-CSN0,Nike Flyknit-0090,.
A vast middle class of people with an income affording more than the basic essentials of existence, will also emerge. These consumers will be not only be more demanding, but will seek goods and services that enrich their lives.
The great probability is that all of this will indeed happen. Basketball Hyperdunk-0105,DC / FARCE BUM BAG DUCK CAMO EDYBA03019-CNN6,Nike KYRIE-0018,, a collapse of the global economy, domestic political upheaval — comes in the way of continued progress.
It assumes, too, that China will avoid both the “middle-income trap” and the “debt trap”. Nike Free45-0462,EASTPAK / PADDED PAK'R® MIX STRIPE EK62035M,Kid free28-35-0033,, albeit at a somewhat slower rate than before. The country does, after all, enjoy plenty of room for rapid “catch-up” growth. Bet on success. Basketball Hardaway-0004,VANS / OLD SKOOL II BP BLACK VONIBLK,Nike Flyknit-0074,.