Economic Environment in China Poised for Growth
With a burgeoning financial sector and widespread fiscal advancement over the past several years, China has become one of the premier developing nations today.
In fact, China could soon be the perfect destination for many global organizations looking to take advantage of new possibilities. As the economic environment in China shifts, however, it is especially important to acquire the proper specialty commercial insurance to mitigate risk and facilitate business.
Surging equity opens more doors
Over the next decade, organizations and investors in China will likely have more avenues for growth thanks to a surging equity market. According to Gulf News, by 2030 China is expected to surpass both the U.K. and Japan as the second largest equity market in the world. China's capitalization is estimated to hit $54 trillion, compared to the United States, which has the largest equity market in the world at $98 trillion.
In addition, China has made up 40 percent of the total emerging world stock market’s deal value, which includes both initial and secondary public offerings.
China's currency expected to take global stage
While the stock market in China is predicted to perform well, so too is the country's currency - the renminbi (RMB). The Economic Times reported a study conducted by China's Renmin University, that predicts the RMB will become one of the world's largest currencies in the next five years, trailing only the U.S. dollar and the euro.The news source noted that currently the RMB is only the fifth most popular type of currency across the globe. Besides the dollar and the euro, both the U.K.'s pound and Japan's yen are more widely used than China's currency.
Overall, this expected surge in prominence has led to improved regulations, such as additional currency swap arrangements between China and 23 other nations.
Economic environment in China depends on real estate
The emerging market in China is bolstered by a number of factors, but much of the growth over the past several years has been driven by the real estate sector. MarketWatch reported that roughly 60 percent of the nation's manufacturing and financing activities are tied to this segment. Across the board, the economic environment in China grew 7.4 percent over the first six months of 2014, with real estate now considered a strength.
While the new developments in China are positive, organizations and professionals will want proper international insurance coverage to address all risks in the nation.
To access the risks and learn more about safety and security, make sure to visit China risk assessment country guide.