## Global Executives Highlight China’s Economic Resilience and Innovation Leadership
China’s economy is demonstrating robust resilience, driven by dynamic domestic consumption and a rapidly evolving innovation ecosystem, stated global executives and economists at the World Economic Forum in Tianjin.
Joseph Luc Ngai, Chairman of McKinsey Greater China, emphasized China’s continued strategic importance for multinationals. "When companies talk about Plan B, China still ends up being a big part of that plan,” Ngai stated. He pointed to a recent McKinsey survey indicating stabilizing consumer confidence, with rural consumers showing particular optimism due to rural revitalization policies and faster income growth. "Consumers are not trading down—they’re becoming savvier,” Ngai explained. "They’re seeking the same quality at a better price, benefiting from China’s highly competitive marketplace, which offers a broad range of quality substitutes and raises the overall standard of living.”
Supporting this view, China’s retail sales of consumer goods rose 6.4% year-on-year in May, marking the fastest pace since December 2023. Young consumers are spearheading a shift towards experience-driven spending, prioritizing work-life balance and fueling economic dynamism in second- and third-tier cities. This trend generates endogenous momentum, particularly in high-end manufacturing and localized services. The evolving consumer mindset reflects a deeper emphasis on personal achievement, with buyers gravitating towards products and services aligned with self-improvement and lifestyle enrichment.
China is also establishing leadership in future-defining industries. McKinsey identified 18 arenas projected to generate $29 trillion to $48 trillion in global revenue by 2040. "China is positioned to thrive in high-growth arenas,” Ngai wrote in a World Economic Forum article, citing artificial intelligence, electric vehicles, and robotics as examples. "In AI-enabled services, China’s established internet and ecommerce companies such as Alibaba and Baidu are integrating generative AI into applications like personalized education, short video creation and enterprise software, while newer players such as DeepSeek have made breakthroughs in large-scale AI models. China’s advancements in EVs, batteries and robotics provides a strong foundation for future growth… These examples underscore China’s ability to lead in emerging arenas, leveraging its scale, innovation ecosystem and technological expertise.” Ngai noted China’s thriving grassroots innovation culture, evidenced by over 4,200 maker spaces, 3,200 business incubators, and 4,000 accelerators.
Karim Dahou, Head of the China Unit at the OECD, highlighted three pillars underpinning China’s sustained development: open trade policies, world-class infrastructure, and exceptional education. "Two-thirds of international trade now involves intermediate goods. China’s openness to importing quality inputs is crucial for its industrial competitiveness,” Dahou explained. "And its eastern regions—Beijing, Shanghai, Jiangsu—rank among the best in global education systems. If you take a company like BYD for instance, they have a bit more than 1 million workers, and more than 10% are engineers. That’s foundational for sustaining growth.”
This industrial excellence attracts global businesses. Elisabeth Denner, Partner and Global Head of Markets at BearingPoint, described China as "one of the most promising and predictable markets.” Confidence in China’s innovation ecosystem is strong, with nearly 63% of German companies in China conducting product R&D locally according to an Innovation Report 2024.
Ilham Kadri, CEO of chemical enterprise Syensqo, underscored China’s dominance: "Half of the world’s chemical output comes from China today. By 2030, that will be two-thirds. With an innovation-led economy, China is becoming a global champion in our industry.”
Stephen Kehoe, Executive Vice President of PepsiCo, views China as both a vast consumer market and a long-term brand development base. "This is a large, sustainable market in itself, with a high consumer base. The scale allows us to grow a business in China for China,” Kehoe stated. "The ability to connect authentically with consumers makes China unique.”
