[nooron]

I think it is worth mentioning how much more cheap capital is available for manufacturing. Chinese state policy—- monetary, fiscal, and social—- pushes up the savings rate, enormously lowering consumption, while restricting the range of consumer financial products. That puts more savings in state banks and keeps interest rates low.

[seanmcdirmid]

This has come up at the expense of their own consumption however, and a reliance on exports instead. Thankfully China has been focusing on diversifying their export markets along with increasing internal consumption in the last decade.

[nooron]

Thank you for raising that point. I would love any recommendations you have to learn more about internal consumption shifts in the last decade.

[seanmcdirmid]

There are the obvious explicit government initiatives to boost consumption, but they've also made some strides in reducing goods and luxury taxes. An Apple iPhone used to be 20-40% more in China (it is technically imported because it is made in an SEZ), but they are only priced at slightly higher than the states now. Cars used to be a huge splurge but cheap EVs are affordable by anyone with an OK job now (although you might not be able to park it if you live in a big city). On my trip a couple of months ago, the malls were booming in a way that I didn't see in 2016 when I left China.

[nooron]

Thanks for sharing your experience. That is very interesting to hear.