It's All About Population

Anyone who has lived in China for any period of time comes to understand very quickly that the 1.4 billion populace is the fundamental issue that governs nearly everything.

This is a dramatic and very broad statement but it is true.

Regardless of what you want to do - buy a train ticket - ride a bus - line up for social services - get a cab - pay your bills --- there are always more people seeking the same result than you imagined. There are always people pushing in line to get ahead.

In 1980 when I first came to China 18% of the total population of about 1 billion lived in urban areas - that is about 172 million people.


In 2006 the urban population jumped to 42% or 577 million people !

172 million increased to 577 million in less than 30 years.

The total US population is 300 million as of 2007.

China's urban areas added the equivalent of the total US population to its urban areas in less than 30 years !

Of course many of these people moved into NEW urban areas built across China's provinces. Not everyone came to Beijing (17 million) and Shanghai (20+ million). The provincial governments have been building new "rural urban areas" to accommodate farmers moving off the land. This wave of urbanization will continue for many more years until China's urban-rural mix looks more like the US with the vast majority of citizens living in urbanized areas.

This is why investors and companies alike see so much potential in the China market. The opportunity to build a new consumer class in China is historic. Not since the urbanization of the US on the 1950s and 1960s has there been such an opportunity.