China will lead the rise of the global economy and sectors related to energy, and consumption in the country has great investment potential, a senior executive at private equity company Warburg Pincus said on Thursday.

"There will continue to be the great rise of the emerging markets," said Charles Kaye, co-president of Warburg Pincus LLC, at a forum held by AVCJ Group Ltd.

"While China and India, each with over 1 billion people, have led this rise, other countries, representing several billion more people, are joining the process."

Global GDP growth will almost certainly come from outside the developed world, with the urbanization drive in emerging markets expected to double the size of the middle class, Kaye said.

According to Kaye, resources including energy have been a global challenge recently. While the competition for new exploration ventures in the United States has been fierce, Warburg Pincus is looking at other sites as well, including Asia, Canada, Europe, Latin America and Africa.

"In China, we are quite positive on our investment in AAG (Asian American Gas Energy Inc) and think there will be many more opportunities to bring much of what we have learned here," said Kaye.

Asian American Gas Energy, a China-based gas developer backed by Warburg Pincus, Baring Private Equity Asia and Chengwei Ventures, was reportedly planning at the end of last year to raise up to $200 million through a Hong Kong initial public offering. AAG engages in the exploration, development, production and marketing of coalbed methane resources.

"As the nature of China's growth shifts and new supply from unconventional plays, as well as the oil sands and new areas of development from around the world comes on stream, the challenges of staying balanced - and dealing with inevitable volatility and shocks - will be increasingly important," Kaye said.

"The focus around the consumer - whether consumer products and retail or healthcare, financial services and real estate - remains at the heart of our own investment strategy in China," he added.

Last year, Warburg Pincus exited from the Intime Department Store Group and made four new investments, which play to the emerging consumer sector - of which China Auto Rental Holdings Inc, China Kidswant Investment Holdings Co Ltd, an emerging maternity, infant and children specialty retailer, and Cubic City (China) Service Apartment Group Ltd were revealed.

According to Kaye, China's growth miracle has been remarkable, but the model of export-led and then investment-and-infrastructure building-led growth is becoming harder to follow, and perhaps even unavailable.

The transition to domestic demand and consumption has been much talked about but it's not easy to accomplish, he said.