Investment opportunities in 'Chindia'
(Xinhua)Updated: 2006-12-05 13:35
Jing Ulrich said the younger generation in China is eager to buy luxury goods
and tends to consume on credit, which gives banks an opportunity to develop
consumer credit services.
The country's expanding senior population are
potential customers for service companies, travel agencies, hotel chains and
insurance companies.
In India, where families will mainly spend on food,
education and housing with their limited disposable incomes, she predicted
business opportunities for department stores and supermarkets.
Consumer
credit is still underdeveloped in China and India where banks prefer to loan
money to companies rather than individual clients. But the situation will change
as consumers in both countries gradually change their traditional attitudes
towards debt, she said.
Mortgage loans will become popular in both
countries due to booming real estate markets.
Bullish commodity markets
are expected in both countries as a result of the continuous growth in demand
for farm products and industrial raw materials.
However, arable land is
shrinking at an appalling pace in China, while India's supply of water resources
is restricted, she said.
China has been the biggest recipient of foreign
direct investment among developing nations for 15 straight years.
Over
the next five years, the country will give priority to the quality rather than
quantity of foreign investment, according to its 11th five-year plan
(2006-2010).
Foreign investors are encouraged to pour funds into modern
agriculture, the service industry, high-tech and advanced manufacturing, and
help upgrade the country's traditional industries.
The plan emphasizes
environmental protection and the efficient use of natural resources, welcoming
foreign investments in the control of water and air pollution and recycling.
The plan criticizes local governments that blindly seek foreign
investment without relating it to a strategy.
It also notes that
emerging foreign-owned monopolies in certain industries pose a potential threat
to China's economic security.
Foreign businesses that abuse intellectual
property right protection laws have adversely affected Chinese firms' capacity
for independent innovation, it says.
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