China To Become World’s Largest Consumer Market by 2015
Tonight I was listening to Radio Havana’s weekly news review and then later Radio China International on shortwave and both stations brought up this story. It hasn’t happened yet of course, but the fact that China is on pace to surpass us as the largest consumer market within a couple of years is pretty significant and I didn’t see this in the US news, although it looks like Forbes covered it.
Although it is significant, it doesn’t exactly spell the end of the United States as we know it or anything. What it does mean is that we’re likely to start feeling the pinch of a little extra resource scarcity as China’s purchasing power grows and the Chinese consumer is able to consume more. As pointed out in China’s Rise and Competing for Resources, China already consumes a sizable portion of many of the world’s commodities.
There’s still a large disparity between consumption levels/standard of living between the average North American/EU citizen and the Chinese citizen, but China’s sheer numbers and recent economic growth make it a market to take seriously.
Let’s play with some rough figures from Wikipedia here…
China has a population of 1.3 billion, a GDP of 7.3 trillion and a per capita GDP of about $5,400USD.
If the per capita GDP of China increased by $1, it would be comparable to adding another Liberia or Djibouti to the world (about 1.3 billion dollars)
If the per capita GDP of China increased by $10, it would be like Iceland or Congo to the world (around 13 billion)
$100? Another Vietnam or Hungary (56 and 57th largest economies in the world) – keep in mind this is about 2% growth. (about 130 billion)
$1000? Just like adding another Australia, Mexico or Spain. This is roughly 20% growth and would represent 1.3 trillion dollars.
These figures are just pulled from Wikipedia and me shooting from the hip with them, but I hope you get the idea that a little bit of growth goes a long way with China and as they grow, finite resources could become a little more dear to us in the United States.
What should be done about this? At a personal level, develop levels of self-sufficiency in order to reduce your dependency on outside resources. At a higher level, it should be good motivation to develop sustainable systems in order to allow more people in the world to live a higher standard of living without causing massive environmental degradation. The Chinese people have a right to pursue a better life, just as we in the west have but I hope we can find ways to do things a little different as more of the world begins to demand lifestyles similar to ours.