The global economic recession is forcing the rich in China to scale down their spending on luxury goods, but it cannot hold back the rapid growth of wealthy households, according to a report released yesterday by global management consultancy McKinsey & Company.

China is expected to be the world's fourth largest country with wealthy households by 2015, after the US, Japan and the UK. The nation is expected to have more than 4 million wealthy households by then, the report said.

The time is right for international luxury companies to invest in China and cash in on the tremendous opportunities over the next five to seven years, despite the negative short-term impact of the financial crisis, the report said.