Smaller cities, rural areas to fuel China consumption

Significance Consumption remains muted since the COVID-19 pandemic and property market slump. However, rising incomes continue to swell the middle class, particularly in smaller cities. Rural consumers also offer considerable potential for growth, not least given substantially lower living costs there. Impacts An ageing population promises heightened demand in market segments characteristic of a ‘silver economy’. Young urban citizens will generate consumption demand, especially in smaller rather than large cities. Different generations will have differing attitudes towards spending and the financial constraints they face.