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The consumption conundrum

First published: China Daily Europe, 07/01/2013

Welcome as it is, increased consumer spending is only one factor in a tricky economic balancing act
Chinese consumption is an important driver of economic growth, and an increasingly key source of sales and earnings for local and international businesses.
From a commercial point of view, selling goods and services to Chinese consumers is a top strategic goal. But from a macroeconomic standpoint, the dynamism of the Chinese consumer sector in the years ahead is a more nuanced phenomenon, linked closely to the complicated process of rebalancing China’s economic model.
We do not know yet if the rebalancing will be well ordered and managed, or result in a more disruptive downturn in investment and credit that would also threaten household spending. How should we think about these contradictory perspectives?…..more