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Much has been written recently about China's economic slowdown, with growth estimated to be 6.7% per annum. While not the double digit growth of a decade ago, it still adds up to $US700 billion of new growth per year.
However, what these figures fail to convey is the change in the kind of growth that is happening in China, and a large part of that is the rise of the middle class. ANZ's China specialists estimate that by 2030, 326 million new Chinese people will join the middle class. That means that 93% of the urban Chinese population will be in the middle class.
Consumption will lift from comprising a 36% share of GDP in 2014 to 50% in 2030. As China shifts towards a consumption based economy, we are in a prime position to capitalise on an insatiable appetite for Australian goods and services in China.
Swisse Wellness recently reported that they are experiencing a 'new golden age' for their Australian goods traded in China. This is a trend we are seeing across our membership base at the Australia China Business Council, as Chinese consumers flock towards premium products, especially in agribusiness, and the health and wellbeing sectors.
Much of this consumption will occur online as outlined by J.Michael Evans, Group President of Alibaba at recent ACBC functions in Melbourne and Sydney. The Chinese e-commerce market is already enormous and holds great potential for Australian business. Since the introduction of the Free Trade Agreement earlier this year, over 85% of Australia's goods exported to China now enter duty free, and that will rise to 93% in four years.
The removal of tarifffs, coupled with the rise of the middle class and new consumerism in China means that there has never been such an opportune time for Australians to do business in China.
The Hon. John Brumby
National President, Australia China Business Council
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National CEO, ACBC