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Women Drive China's Booming Economy

China's economy keeps humming along nicely, growing at about an 8% annual rate. And so far in 2009, retail sales in China have been rising at a brisk 15% rate. Much of this economic growth has been driven by a purchasing powerhouse - Chinese women under the age of 35.

That growth looks set to continue. A recent study surveyed female consumers in China and 80% of them said they expected to spend more in the next six months than in the last six months. Sounds like the United States before the Wall Street "bomb" blew up the US economy.

Chinese women are not only exerting influence on decision-making in their own homes but they are also making purchase decisions for their parents when they live in the same house or neighborhood.

Women in China now contribute about half of household income, up from 20% in the 1950s. Their educational opportunities have greatly grown, and they have entered the white-collar force in large numbers.

Female consumers in China are becoming less price sensitive and more sophisticated about the brands and products they buy. These female consumers are similar to female consumers elsewhere and do things such as conducting research online before buying items.

Chinese women have another similarity - they are also greatly concerned about the safety of the products they buy for their children. At times, American shoppers worry about a 'Made in China' label and safety issues. These women have to deal with this every day. Many choose where to shop based on whether they think they can find genuine and non-toxic products.

In fact, affluent Chinese women have been known to fly to Taiwan just to buy products for their babies. They are willing to spend more for their children's safety and buy the safer foreign products.

This huge body of confident consumers has investment implications. It bodes well for the continued rapid growth of the Chinese economy and for the long-term growth in investments in Chinese stocks, mutual funds and ETFs.

It can also bode well for large American companies that have a large presence in China. Some of the best-known American brands would include: Coca-Cola, Pepsico, McDonald's, Yum Brands, Johnson & Johnson and Walmart.

If you have any questions or comments about this article, please contact at the Investing forum or directly through email.


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Content copyright © 2013 by Tony Daltorio. All rights reserved.
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