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Unlike the United States, where the market development has reached its limits, China's economy itself has at least four major market dividends:

First, urbanization dividends. Although the population of China living in cities and towns has reached 60%, the actual level of urbanization is only about 50%. These two figures are far from the general urbanization rate of 75% to 90% in developed countries. It determines that China's domestic demand growth space is huge and long-term, and will continue for at least 20 years.

The second is the labor productivity dividend. Although China is the world's largest manufacturing country, China's per capita GDP is just over US$10,000, labor productivity is still at a low level, and there is still huge room for improvement. Mechanization, electrification, artificial intelligence, asset securitization, etc. can greatly increase labor productivity, and there is still a lot of room for optimization and refinement of the social division of labor, which determines that development space is still large.
Given China’s market size and space, China can certainly catch up with the United States in terms of per capita GDP, from US$10,000 to US$66,000. You can imagine the vast opportunities.

More importantly, all of this is in China’s control. China has the corresponding population base, education base, science and technology base, industrial base, etc., and the improvement of labor productivity is not constrained by any country. 

The third is to expand consumption dividends. Why is China's expanding consumption dividend so strong? There are three reasons: one is the objective demand for urbanization in China, the second is the room for improvement in China's labor productivity, and the third is China's savings rate as high as 45%. These three points determine that China not only has the current consumption potential supported by the high savings rate, but also the potential for urbanization and labor productivity improvement. This determines that China's consumption potential is sustainable and continuously developing. Therefore, China has great potential to expand its consumption dividend, and China's future market space will be at least five times that of the United States.

The fourth is the innovation and upgrade bonus. For China, technological innovation, industrial upgrading and model innovation are all dividends. In terms of scientific and technological innovation, China has already made global leading breakthroughs like 5G, and there are also a series of other breakthroughs that are relatively leading, and there is huge room for breakthroughs in some backward areas. This determines that technological innovation can bring China a huge bonus.

The same is true for industrial upgrading. China’s R&D upgrading will bring about industrial upgrading and technological upgrading, which will increase labor productivity. At the same time, the huge market of 1.4 billion people also determines the huge room for model innovation.

The dividends of innovation and upgrading in the United States and Europe are no longer as large. They are already developed countries and belong to the post-industrial era. Therefore, the space for innovation and upgrading is not as huge as China.

China Explained will show you that because of China’s continued success in industrial upgrading, technological innovation and realizing its huge potential, it is an unstoppable process. The inevitable rise of China may feel intimidating and some simply reject it. Don’t be. China’s rise is part of the new global trend unlike what we have seen in the past one hundred years. Embrace the change and seize the opportunity.

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