Great talk on China challenges/opportunity from Daniel Street, Senior Strategist for the private-sector arm of the World Bank Group, International Finance Corporation (IFC). Three secrets to China’s success in regaining a world leadership position by 2030
1. A Strong Banking Sector: Based on the number of banks in China and the government fiscal measures in place if there were a financial crisis it would likely be contained within Chinese borders
2. A Strong Labour Force: China did not buy 850 million people out of poverty, going through rapid urbanisation and they are investing in their future. The demographic dividend is yet to come to fruition with over 8 million University graduates each year growing to 10 million + in the next few years. China also invests heavily in R&D. 5 years ago R&D accounted for 1.5% of GDP, this has grown to approx 3% of GDP today.
3. A Strong Emerging Middle Class: China had approx 55 million people in the middle class in 1995. This is forecast to grow to 1 Billion or approx 70% of the total population by 2030.