China Economic Overview
- In 2014, China's official GDP reached $17.63 trillion.
- 2014 GDP growth rate 7.4 percent
- Inbound foreign direct investment was approximately $128 billion in 2014.
- Agriculture, traditionally the largest portion of GDP, was eclipsed by both the manufacturing industry and the service industry in 2011. Composition by Sector: Agriculture: 9.7 percent; Industry: 43.9 percent; Services: 46.4 percent
China's imports are increasing exponentially
2011 - USD $1.75 billion spent on imports2014 - USD $2.25 trillion spent on imports, an increase of 28.5 percent
- In 2010, China's urban population was 47 percent of the total population, with an annual rate of urbanization of 2.3 percent. By the end of 2014, 54.7 percent of Chinese lived in urban centers.
- Urbanization is expected to boost domestic demand by USD $4.5 trillion over the next two decades.
- Beijing, Shanghai, and Hong Kong are listed among the "World's Top 10 Cities of the Super Rich."
- China's middle class has grown from 65.5 million in January 2005 to 80 million in January 2007. According to the UN Statistical Division, China's middle class is forecast to expand to 630 million by 2022; 45% of its population.
China's Consumer Market
As China's GDP has increased exponentially over the past 25 years, so have real wages. Even with increasing wages, China still maintains one of the lowest manufacturing overhead costs in Asia.
Increase in wealth is fueling the growth of a sophisticated middle class of consumers and an increase in disposable income.
China is the second largest consumer market in the world after the US.
Between 2010 and 2020, the number of households in China with an annual disposable income above US$10,000 will almost quadruple – from 57.1 million households in 2010 to 222 million by 2020.
Electronics: China is one of the world's largest consumers of cell phones, computers, and other personal electronic devices.
Imported Foods: By 2016 China is expected to be the world’s largest consumer of wine even though wine does not play a major role in Chinese cuisine as it does in Western cuisine.
China is now the world's largest importer of luxury goods accounting for nearly 30% of total global spending in 2013
Opportunities for US Companies
China is the US's 2nd largest trading partner behind Canada at $124 billion in 2014.
In 2014, China bought $1.96 trillion worth of imported products up by 40% since 2010.
US export growth to China between 2004-2013 was 255 percent.
More and more US companies manufacture in China to sell to China instead of exporting. China currently has enough purchasing power to buy 5 percent of the world's products, but that figure is projected to grow to 14 percent by 2015.
E-commerce is expanding rapidly. In 2013, China's e-commerce revenue reached $307 billion and is projected to reach one trillion dollars in 2019.