Changing lifestyles in China's cities
China's urbanisation has been extremely rapid - a process that took centuries in the West has been squeezed into a much smaller timeframe.
The Chinese government is carefully monitoring this rapid social transformation and a government think tank has developed the “Blue Book”, which regularly assesses people’s views about the quality of life in urban centres.
The most recent edition came out in August and one of the findings was that people are less happy in the mega cities than in the smaller ones. The complaints about mega cities included high housing prices, traffic congestion, urban poverty and inadequate schooling and health services.
Despite the Chinese economic miracle over the past few decades, the median income is still low and there is a high level of inequality. Higher incomes are generally concentrated in a few elite groups such as civil servants, university teachers and executives in hi-tech companies. So for many urbanites, the level of income doesn’t sufficiently compensate for the extensive social problems in the mega cities.
I see two major lessons for Thailand in the trends towards urbanisation in China.
The first is that smaller cities will become increasingly important, as local authorities will strengthen their efforts to develop second- and third-tier cities to slow down the growth of major cities.
The second lesson is that as the middle class continues to grow, spending patterns will replicate those of other international cities, with a higher proportion going to the services industry, including entertainment, restaurants, travel and health. There will also be a shift in the way people spend their money. For example, traditional wet markets will decline while household spending will switch to supermarket and hypermarts.
By 2023 it is predicted that the middle class will make up half of the urban population in China, mirroring trends elsewhere in Asia. Eventually China’s demographics are predicted to resemble what’s been described as an “olive-shaped income structure” with tapering ends representing the very wealthy and the very poor.
Since a rapidly-growing middle class encourages both high growth and stability, this will further underline China’s role as an engine of global economic growth.
For more columns in this series please see www.bangkokbank.com
