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Economic 360 Perspective for China: Growth Prospects and Emerging Opportunities in the ICT Industry
Frost & Sullivan, May 2011, Pages: 101
China has been the fastest growing economy, expanding at 10.5 percent annually, driven by exports and investment. High priority is given to transform economic structure from export driven to consumption driven economy during the 12th five year plan period. The ICT industry has emerged as driver of economic growth supported by government initiatives and increased investment. The recent development plans of the Government aim at expanding the internet connectivity across the rural-urban space. Opportunities exist in fixed line, mobile, broadband, computer hardware and IT services markets.
China’s economy has shown outstanding growth since 2004 and has weathered the global economic downturn well and even registered a modest growth in 2010. With a projected 9.5 percent growth in the economy in 2011 and significant investments from the Government, the Chinese ICT industry is expected to gain considerable momentum. The government has committed to stabilizing exports and boosting imports to reduce the trade surplus. Higher inflation rate is a big concern for the Chinese Government in 2011 and hence, the control of inflation and the management of inflation expectations are essential for a healthy fiscal policy and monetary policy adjustments. Unprecedented levels of foreign direct investment (FDI) are a testimony to the Chinese economy’s ability to attract more capital.
Other key economic drivers include the Grand Western Development Program, urbanization, the development of low-carbon technologies, the policy of indemnificatory apartments, environmental protection, and the reform of income distribution system. The industry sectors with the greatest potential are the seven strategic emerging industries of energy-saving environmental protection, new generation of IT, biological technology, high-end equipment manufacturing industry, new energy, new materials, and new energy automotive industry.
The country’s industrial policies encourage innovation and R&D and the policies indicate China’s eagerness to adopt energy-saving communication technologies and develop the next generation of ICT related technologies. Meanwhile, the appreciation of the Chinese Ren Min Bi (RMB) has resulted in much cheaper imports, but greater expenses for enterprises with high dependence on foreign markets. Against the backdrop of increased consumption, there will be more enterprises focusing on the domestic market, and trade in the ICT industry is likely to increase steadily year-on-year. Eventually, business in the ICT industry will witness a move toward high-end products and services. The substantial contributions of ICT to the gross domestic product (GDP) in China will be apparent in the next five years. Development of, and access to greater bandwidth will increase opportunities for ICT-related businesses. The tri-network integration and the Internet of things are likely to power the ICT industry in the next five to ten years. Other than the potential in the ICT infrastructure area, opportunities also exist in the service sectors of mobile payment and outsourcing.
Economic 360 for China: Growth Prospects and Emerging Opportunities in the Information and Communications Technology Industry is Frost & Sullivan’s Country Industry Forecast service, which provides vital inputs for evaluating the attractiveness of a country and its ICT industry. Apart from enabling decision makers to assess the impact of non-market forces, it also helps in identifying new market opportunities. This service provides a strong base for preparing contingency plans. In addition, investors can assess industry-specific risk factors as well as conduct a more in-depth micro research.
Benefits
The following benefits are offered by this research:
Identifying New Market Opportunities
The future trends and developments in the Chinese ICT industry have been identified by taking into account the economic environment of the country. The analysis will prove greatly informative to industry participants and stakeholders.
Understand Future Industry Trends
This research service gives powerful insights into economic developments and trends in the Chinese ICT industry and further explores the key drivers and trends.
Comprehend Policy and Economic Environment
An analysis of the dynamics of the economic growth in China provides keen insights into the economic parameters that will influence the ICT industry. Industry performance is closely related to the level of economic growth and industry plans. The study offers useful data on government initiatives regarding policies and financial support.
Evaluate Industry Segment Potential
This research service focuses on providing an analysis of country and industry trends and will aid companies seeking to enter new geographic markets. The market and economic insights will also prove invaluable to corporate planners in the development of accurate business plans or allocation of resources.
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