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November 15, 2011

Commenting on China income imbalances and how third and fourth tier cities are catching up

There are comments about China's income imbalances.

Some points that I have on coastal versus interior income differences

1. Rural poor are getting lifted up the city levels with the urbanization of 15 to 25 million people every year. Those move to the cities move up to city level wages over a few years.

2. People who live in the cities in the interior can often have more disposable income than people who live in Shanghai and Beijing. There are various statistics which show less of a gap and real life contacts indicate that there are significantly higher levels of disposable income when it is not tied up in expensive property.

Here is an article about the top cities in China in 2010 for per capita disposable income.


China's third and fourth tier cities are catching up.

Over the past decade locations such as Chengdu, Dalian, Nanjing, Qingdao, Shenzhen, Suzhou and Tianjin and so on are well established locations with plenty of infrastructure, international airports, (Suzhou aside, which is so close to Shanghai it doesn’t require one) metro systems and all the mainstream conveniences one could possibly want.

Economic growth has been moving from the coastal regions to the inland regions.




3. China is damming all of its rivers to make them deeper and able to send ten thousand ton barges into the interior. Adequate levels of power and cheap transportation of shipped goods is enabling the interior to be developed. Also, factories were moved inland to continue to lower costs.

A guide to China's emerging cities is available for $40

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