(CercleFinance.com) – After a particularly difficult confinement, China is slowly reopening its economy and sharpening the interest of investors, always on the lookout for opportunities.
Passing through Paris, Jie Lu, head of the investment division for China at Robeco, a Dutch asset management specialist, recalls that if the growth of the Middle Empire slows down markedly, it is still expected to be 4, 5% per year between 2022 and 2025 and 3.5% per year between 2026 and 2030.
According to the specialist, Beijing has implemented a plan based on the quality of growth. China is focusing in particular on developing its capabilities in artificial intelligence and advanced manufacturing to drive technological innovation.
‘The government also intends to fight against the gap between rich and poor, and develop a middle class,’ explains Jie Lu in substance.
However, there is no question for Chinese consumers to expect to receive government aid, as was the case in particular in the United States. “It is indeed these aid plans that have contributed to inflation,” the official believes.
In this context, China is counting on access to employment and intends to continue the structural reforms that have been initiated. The idea? Develop ‘an inclusive development model and build a society of equal opportunities with better social protection’.
Finally, as part of the climate challenge, Beijing intends to ‘green’ its infrastructures and aims for carbon neutrality by 2050.
In view of these ambitions, economists are closely scrutinizing the weight of debt on the Chinese economy, and in particular household debt. Debt in the non-financial sector is approaching 300% of GDP.
Robeco nevertheless identifies several investment themes in the country. In terms of consumption, investors can take advantage of the digital boom, the success of ‘healthy’ products or the demand for local brands.
In terms of technology & innovation, Robeco highlights in particular the rise of 5G, AI and the Internet of Things. Finally, the upgrading of industry could also attract capital, both in new energies and in robotics.
On the macro-economic level, Robeco believes that it is seeing the first signs of the reopening of the country, with a resumption of mobility and the development of the service sector. Nevertheless, tensions between the United States and China remain.
‘Earnings may take some time to return to their levels, but the market valuation remains attractive,’ said the asset management specialist.
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