Ask HN: Why China is the Future (of Business)? | Hacker News Reader

Ask HN: Why China is the Future (of Business)?

2 pointsliuliu4 comments

I consider of writing a blog post, but second thought, why not post here and ask for why?

Everyone who is talking about Google's decision of pulling out China operation will say that this move will damage its long-term growth.

But is China that important at all? It is a country with huge population indeed, but most of them will become too old to work before 2020. And the social structure will become a few youth to feed large population of old.

Is China rich? Maybe.

Is China large in terms of land? Chins is as large as the United States, but half of the land is inhabitable.

Is China resourceful? Probably not. China imports most steels, oils, woods for production.

Now, why everyone tells me Chinese market will be huge in the future?

Volumes drive many businesses. The buying capacity of China & India are raising.

If 15% of the population use your service that exceeds the total US population. Any business driven by volumes eg. telecom providers, all FMCG products would never want to miss out on India & China. For Google too it is the userbase of search, the starting point of big volume business.

edit: by 15% I meant 15% of India & China combined.

But here we are talking about aging people in China and relatively young poeple in India.

number of people * average annual income = $'s available for buying things

Pretty much any number multiplied by 1 billion people = a lot.

As the average Chinese citizen becomes better off the result of that calculation will go up really fast. If the average annual income of Chinese citizens goes up by 1%, for example, that translates into an enormous amount of money available within the Chinese economy.

Compare the potential for growth with western countries. China has a long way to go before achieving parity with most western countries. Poorer countries have the potential for rates of economic growth that vastly outstrip countries that are already wealthy. Whether it will happen is another matter but the potential is there.

My central concern is the population in China will age very fast. What if there is no much young people (even compared to U.S.), and old people is not rich enough to become potential consumer?

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