Despite recent concerns about China’s economic and retail sales growth, Invesco’s CIO for Asia ex-Japan Mike Shiao thinks that consumption remains a reliable driver of growth for the world’s second-largest economy. What was once a growth engine that relied on China’s largest cities as fuel now needs more input from other sources. At the same time, a confluence of several developments is facilitating the consumer market’s growth in these smaller cities.
As such, the time is ripe for lower-tier cities to play a bigger role in driving consumption growth in China and they, together with top-tier ones, will drive China’s consumer sector’s “upgrade” – or its continued expansion as demand intensifies for higher-quality, higher-priced goods and services.
To read the analysis, click on “Download PDF”.