[China packaging and printing industry network market dynamics (push, map)]
Sina Finance said that Li Xunlei, an economist at China-Taiwan Securities, pointed out that in the past year, the industries closely related to consumption, including food and beverage, biomedicine, culture and entertainment, and retail and retail, have developed rapidly, and the contribution of consumption to GDP has reached a new high in recent years. For example, the contribution of 2017 to the economic growth accounted for 58.8%. As far as the secondary market is concerned, the increase in the “drinking and taking medicine†section in 2017 is also quite impressive. The article believes that China's economic transformation will inevitably lead to sustained consumption upgrades, so 2018 is still optimistic about big consumption.
At the macro level, we are optimistic about the three major logics of big consumption.
Big logic, China's economic growth is highly dependent on investment. As the economic transformation deepens, the decline in investment growth will be a long-term trend. In 2017, the nominal growth rate of China's fixed asset investment fell to 7.2%, which was lower than the nominal growth rate of GDP and lower than the growth rate of total retail sales of consumer goods. And 10 years ago, the growth rate of fixed asset investment reached 24%, far exceeding the growth rate of GDP.
The report of the 19th National Congress of the Communist Party of China stated that the Chinese economy has stepped from pursuing high growth to pursuing high quality. Since November last year, the Ministry of Finance, the State-owned Assets Supervision and Administration Commission and the National Development and Reform Commission have issued regulatory opinions on regulating PPP projects, and financial institutions have gradually adopted a PPP attitude. Cautiously, banks have recently suspended their PPP project financing; in addition, real estate investment growth will also decline as financing costs continue to rise. Therefore, it is estimated that the growth rate of investment this year will also decline, especially the slowdown in the growth rate of infrastructure investment will be more obvious.
In the 6.9% GDP growth rate in 2017, net exports contributed 0.6 percentage points. Under the background of the slowdown in the economic recovery in Europe and the United States and the appreciation of the renminbi, it is estimated that the growth rate of exports will decline in 2018, contributing to GDP growth. Will also decrease. In this context, the Chinese economy's dependence on consumption will be further improved. In order to prevent the economic downturn from being too large, a series of policies to encourage consumption may be introduced in 2018.
The second largest logic, in the process of economic transformation, the proportion of the tertiary industry is an inevitable trend. In 2017, the added value of the tertiary industry accounted for 51.6% of GDP, and will continue to rise in 2018. In addition, among the added value of the tertiary industry, the proportion of financial services industry and real estate industry in 2017 has dropped significantly. The growth rate of the two industries is only 4.5% and 5.6% respectively, which is lower than the 8% increase in the tertiary industry. speed.
The decline in the proportion of finance and real estate reflects the obvious effect of the move to defy China's economy. The problem of idling funds in the financial sector will be improved. The growth rate of M2 will fall to 8.2% at the end of 2017, meaning The decline in the scale of off-balance-sheet business. The intensity of financial supervision in 2018 will not diminish, and there will still be funds to withdraw from the financial sector, which is beneficial to boost consumption.
The third big logic, the change in demographic structure will lead to an increase in consumption and a decline in “savingsâ€. China is one of the countries with a high national savings rate. After 2010, China’s national savings rate has peaked, or it is related to the decline in the proportion of China’s working-age population. Changes in demographic structure will be reflected in two aspects. On the one hand, as the population ages, the household savings rate will slowly decline, and the consumption rate will increase accordingly, similar to the Japanese model.
On the other hand, the income of Chinese residents is divided by age group, and the high should be 60-70 post-group. As they enter the late stage of their career, the consumption in health care, recreation and entertainment will inevitably increase; Relatively low 80-90 group, they are more able to accept the modern consumer's advanced consumption concept, namely credit consumption. According to statistics, in the past 10 years, the level of leverage of residents has roughly doubled. In 2017, consumer loans ABS and credit card loans ABS issued 83.7 billion yuan and 65.3 billion yuan respectively, up 12.86 times and 3.66 times respectively.
In short, the above three logics of optimistic about large consumption are all related to each other, reflecting the economic transformation in the context of rising per capita income of the residents and higher levels of service industry and population aging. It will continue to escalate, and the consumption-led economic growth model has begun to emerge. Although the current Chinese economy is still far more dependent on investment than the global average, from the perspective of asset allocation, it should focus on the future of the consumer-led economy.
Where are the consumer hotspots: revealing facts with macro data
Many people are optimistic about China's consumption and consumption upgrades. It is based on the logic of per capita GDP reaching 8,000 US dollars. In fact, there are three major misunderstandings in this logic. One is the per capita GDP level expressed by the present value of the US dollar, and the developed countries in history. The per capita GDP level in the stage of consumption appreciation is incomparable; the second is that the purchasing power parity between China and developed countries is very different; the third is that the total disposable income of Chinese residents accounts for a much lower proportion of GDP than developed economies.
The article found that the growth rate of consumption has a significant correlation with the income growth of residents, especially the median correlation between the growth rate of disposable income of residents. For example, in 2017, the per capita disposable income increased by 9%, which was significantly higher than the 8.4% in 2016. However, the median growth rate of disposable income of residents dropped from 8.3% in 2016 to 7.3%.
Correspondingly, in 2017, the per capita nominal consumption expenditure of urban residents was 24,445 yuan, an increase of only 5.9%, while the growth rate in 2016 was 7.9%, which actually dropped by two percentage points. Similarly, the total retail sales of consumer goods in 2017 increased by 10.2% over the previous year, and also dropped by 0.2 percentage points from the previous year.
Why is the growth rate of household consumption expenditure far below the income growth rate? The problem lies in the difference between the median and the average, that is, the income growth of high-income groups is higher than that of low- and middle-income groups. Because high-income groups have lower marginal propensity to consume, but they account for a higher proportion of total household income, their incomes increase the average income of residents, but they do not contribute much to consumption.
So why do high-income groups get richer and richer? This should be related to the rise in housing prices in 2017, because more than 60% of the assets of domestic households are allocated to real estate. Last year, the yields of equity assets or wealth management products were dragged down by the growth of property income of residents. According to the National Bureau of Statistics, the net income per capita of the national residents last year was 2,107 yuan, an increase of 11.6%.
Since 2015, the continued rise in house prices has been the main reason for the rise in the domestic Gini coefficient. Therefore, from the perspective of changes in the income structure of residents, consumption is still worthy of optimism, because it is related to the high income growth rate of high-income groups, that is, there is a significant positive correlation between the Gini coefficient and the growth rate of consumption.
According to the data released by the China Association of Automobile Manufacturers, passenger cars sold a total of 24.72 million units in 2017, a year-on-year increase of only 1.4%, a sharp drop of 13.5 percentage points over the previous year. However, the growth rate of domestic luxury car sales has exceeded 20%. Similar to this, the growth rate of urban residents in food, tobacco and alcohol consumption in 2017 was only 3.5%, but the sales growth rate of some liquor and beer exceeded 20%.
In the 2017 consumption data, the consumption expenditures of housing, education, culture and entertainment and health care were 9.6%, 8.9% and 11% respectively, which means that service consumption is more worthy of optimism. It benefits from the increase in income level of residents. Factors such as the consumption upgrade and the aging of the population, especially in the health care category, are more worthy of optimism. Judging from the increase in the stock price index of 39 industries in the stock secondary market in the past 10 years, the cumulative increase in the pharmaceutical bio industry ranks.
Outlook for Big Consumption in 2018 - Encouraging Consumption Policy
Looking back at the characteristics of China's economy in the past two years, it is not difficult to find that China's stable economic growth in 2016 depends on investment. The highlight of consumption is passenger cars (half-acquisition policy for 1.5-liter displacement); China's stable economic growth in 2017 depends on exports. (If the net export factor is excluded, the GDP growth rate is only 6.3%), and the highlight of consumption is housing-related consumption, such as furniture, home appliances, and home improvement. Then, in 2018, these reliances and highlights seem to be a little retreating. If investment growth will continue to fall, exports will not be better than 2017. As China's economy enters the era of stock ownership, the growth rate of consumption related to automobiles and housing will certainly decline.
Based on the above judgments, China's economy will be more dependent on consumption in 2018. If the growth of housing and automobile consumption in consumption slows down, it must be stimulated by policies to increase consumption. As mentioned above, the growth rate of consumption and disposable income of residents, especially the income growth of low- and middle-income groups, is relatively high. In the past two years, the income growth of high-income groups is faster than the average. Then, in 2018, we should consider how to increase the income growth of low- and middle-income groups.
Although the eradication of the poor is the policy focus in the next three years, the proportion of the poor is already very low. Even if the goal of comprehensive poverty alleviation is achieved, the positive effect on consumption is relatively limited, but the middle and low income groups account for the total population of China. The proportion of more than 70%, this is the main force of consumption.
However, improving the income level of low- and middle-income groups and narrowing the income gap is a long-standing problem. It can only be partially improved from tax incentives and social security increases. Since the contribution of private enterprises to employment accounts for more than 80%, the growth rate of private investment has declined significantly over the years, which is obviously unfavorable for raising the income level of low- and middle-income groups. In 2017, the actual growth rate of private investment was only 4.5%. Therefore, it is especially necessary to take more effective measures to prevent private investment from falling too fast.
In 2018, a series of policies to encourage consumption should be introduced, especially in areas where mass consumption is growing rapidly, such as lowering consumption tax.
It is expected that the overall increase in house prices in the country should be reduced in 2018, and the sales of commercial housing should also decline. This means that the growth rate of residents' property income will slow down, that is to say, the income growth rate of high-income groups will fall back. Based on this, it is estimated that the growth rate of consumption in 2018 will decrease. For the capital market, should the allocation of consumer assets be more inclined to the mass consumer equity assets?
In addition, the growth rate of service consumption will certainly far exceed physical consumption, which is also a typical feature of consumption upgrading. For example, in 2017, the total national box office increased by more than 13% over the previous year, and the total tourism revenue exceeded 5.3 trillion yuan. As the price increase of service consumption far exceeds the price increase of living materials, it is estimated that the service price will further increase in 2018, which also becomes the logic to increase the allocation of service-type consumer assets.
Comparing the consumption data of the two years of 2016 and 2017, it is found that the sales growth of few consumer goods is lower than the growth rate of consumption, which is not entirely a factor of the price increase of consumer goods, because the overcapacity phenomenon in the living materials industry is more Obviously, it may be related to consumption upgrades.
After the article, the production companies that have the ability to upgrade consumer goods while maintaining sales volume are mostly enterprises with high market share in the industry, or leading enterprises. Under the guidance of the stock economy, the sales growth of consumer goods will become more and more limited. Many enterprises in the industry will surely have a differentiation phenomenon. The strong ones will be strong and the survival of the fittest. Therefore, compared with 10 years ago, the phenomenon of being proud of the past has become a thing of the past, and the industry differentiation will become more intense. When deploying assets, it is more likely to choose a leading industry leader to obtain a premium.
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