December 1, 2005
China as Consumer

This article seeks to examine two key issues that will be major drivers of consumption in China over the coming five years: urbanization and environmental amelioration. Whether the issues identified will be the largest factors over this time frame remains unclear, but each of these two areas warrants considerable attention as a very significant contributor to the future of consumer demand in China.

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Conclusion

Regardless of GDP growth projections for China, or the ups and downs of a business cycle, the fundamental underlying processes of urbanization and ameliorating environmental deterioration will inevitably create huge and persistent demand over the next five to ten years. The rate of investment in infrastructure projects will not abate. Chinese consumption of the materials and services that go into such projects will remain very high. China will have no choice but to look internationally for many of the necessary resources to satisfy these demands.

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