China is proactively tackling its major challenges
Whatever you think of China’s Government, or read in the media about its political system or international reputation, you cannot ignore its economic potential, its robust and stable Government, its commitment to long term ‘top down’ planning, and its ability to tackle its challenges head on. As a potential investor in China’s future growth story, it's therefore important to maintain an objective view and curiosity about what’s actually happening on the ground in China and to access commentary, views and information from a wide range of independent and/or local sources.
Whilst China’s economic success over the past 40 years has been dramatic and unprecedented, it has also created huge problems, challenges and disparities. Not just for the environment but for society aswell and, having initially been embraced by western markets for the economic benefits delivered from China’s admission to the WTO in 2001, China now faces geo-political challenges that were unimaginable five years ago.
As a result, the Chinese Government’s economic policy priorities have recently shifted to social equality, national security and self-sufficiency:
- The ultimate goal of social equality is to achieve common prosperity by narrowing disparities between the rich and poor
- Recent regulatory scrutiny on e-commerce platforms, tech companies, online gaming and big data operators is deemed to be an effective way to ensure national security aswell as creating equal opportunities for all.
- Sanctions and bans by the US are accelerating the development of domestic supply chains to mitigate against future geo-political challenges
All of these priorities present significant opportunities for investors who look beyond the headlines and follow the trends, particularly in sectors like retail, healthcare, technology and renewable energy, which also represent major Government priorities.
China is a planned economy. It publishes its challenges, priorities and targets every 5 years in its Five Year Plan. There are very few surprises. As has been the case for over 40 years, successful investors and entrepreneurs make decisions and take positions designed to capitalise on sectors, companies and opportunities that will benefit from Beijing’s policy priorities.
Why wouldn’t you be one of them?