Things change quickly in the retail sector, especially in China. Over the next five years, the Chinese market will roughly double in size, overtaking the US—the current market leader—for the first time. By 2022, China’s retail market will grow to twice the size of the US. These and other retail forecasts are featured in a new report from the Economist Intelligence Unit, Retail 2022 (free registration required).
China already overtook the US as the world’s largest food and grocery market this year. Future expansion will be fuelled by the country’s swift GDP growth. In 2002 China’s nominal GDP was less than 15% of the US; it now stands at 52% of American GDP. We expect the nominal size of China’s economy (in dollar terms) to surpass the US by 2022.
The combination of economic growth and urbanisation is fuelling China’s rapid retail expansion, and not just in first-tier cities such as Shanghai and Beijing. Rising wages and government-driven efforts to boost consumer spending will see the share of inland urbanites earning over Rmb30,000 (US$4,805) per year in places such as Xi’an and the Chang-Zhu-Tan city cluster roughly double between 2012 and 2022. Given this outlook for China’s burgeoning urban middle-class shoppers, it’s easy to see why many retailers are redoubling efforts to build a presence in the country.
The EIU's Consumer Goods Briefing assesses the consumer goods and retail industry in the world's biggest markets. It leverages the expertise of EIU analysts and data from Planet Retail to offer five-year forecasts for a range of sub-sectors.