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New Mega Trends : Rise of the DragonNew Mega Trends : Rise of the DragonNew Mega Trends : Rise of the DragonNew Mega Trends : Rise of the DragonMacro to Micro Implications of Mega Trends in China Macro to Micro Implications of Mega Trends in China Macro to Micro Implications of Mega Trends in China Macro to Micro Implications of Mega Trends in China
on Future Business, Cultures and Personal Liveson Future Business, Cultures and Personal Liveson Future Business, Cultures and Personal Liveson Future Business, Cultures and Personal Lives
Today’s PresentersToday’s PresentersToday’s PresentersToday’s Presenters
Sarwant SinghSarwant SinghSarwant SinghSarwant SinghPartner
Frost & Sullivan
Archana AmarnathArchana AmarnathArchana AmarnathArchana AmarnathProgram ManagerFrost & Sullivan
2
Archana AmarnathArchana AmarnathArchana AmarnathArchana AmarnathProgram ManagerFrost & Sullivan
Marcia ChaoMarcia ChaoMarcia ChaoMarcia Chao----Mei ChiuMei ChiuMei ChiuMei ChiuResearch AnalystFrost & Sullivan
AgendaAgendaAgendaAgenda
Presentation of Top Mega Trends of the FuturePresentation of Top Mega Trends of the FuturePresentation of Top Mega Trends of the FuturePresentation of Top Mega Trends of the Future
Introduction and Definition of Mega TrendsIntroduction and Definition of Mega TrendsIntroduction and Definition of Mega TrendsIntroduction and Definition of Mega Trends
Key Strategic ConclusionsKey Strategic ConclusionsKey Strategic ConclusionsKey Strategic Conclusions
Macro to Micro : How To Apply Mega Trends Within Your Macro to Micro : How To Apply Mega Trends Within Your Macro to Micro : How To Apply Mega Trends Within Your Macro to Micro : How To Apply Mega Trends Within Your Organisation to Develop Growth StrategiesOrganisation to Develop Growth StrategiesOrganisation to Develop Growth StrategiesOrganisation to Develop Growth Strategies
3
Top Mega Trends Covered in the ResearchTop Mega Trends Covered in the ResearchTop Mega Trends Covered in the ResearchTop Mega Trends Covered in the Research
What is a What is a What is a What is a Mega Trend?Mega Trend?Mega Trend?Mega Trend?
Mega trends are transformative, global transformative, global transformative, global transformative, global forces that define the
future world with their far reaching impact on
Urbanization Urbanization Urbanization Urbanization –––– City as a City as a City as a City as a CustomerCustomerCustomerCustomer
Smart is the Smart is the Smart is the Smart is the New GreenNew GreenNew GreenNew Green
Bricks and Bricks and Bricks and Bricks and ClicksClicksClicksClicks
Innovating to Innovating to Innovating to Innovating to ZeroZeroZeroZero
Future Future Future Future Infrastructure Infrastructure Infrastructure Infrastructure DevelopmentDevelopmentDevelopmentDevelopment
Health, Health, Health, Health, Wellness and Wellness and Wellness and Wellness and Well BeingWell BeingWell BeingWell Being
Mega trends are transformative, global transformative, global transformative, global transformative, global forces that define the
future world with their far reaching impact on business, societies, business, societies, business, societies, business, societies,
economies, cultures and economies, cultures and economies, cultures and economies, cultures and personal livespersonal livespersonal livespersonal lives.
Social TrendsSocial TrendsSocial TrendsSocial Trends
Connectivity Connectivity Connectivity Connectivity and and and and ConvergenceConvergenceConvergenceConvergence
New Business New Business New Business New Business Models: Value Models: Value Models: Value Models: Value for Manyfor Manyfor Manyfor Many
Beyond BRIC: Beyond BRIC: Beyond BRIC: Beyond BRIC: The Next The Next The Next The Next Game Game Game Game ChangersChangersChangersChangers
Wellness and Wellness and Wellness and Wellness and Well BeingWell BeingWell BeingWell Being
Future of Future of Future of Future of MobilityMobilityMobilityMobility
4
Mega Trend 1:Mega Trend 1:Mega Trend 1:Mega Trend 1:
Urbanisation Urbanisation Urbanisation Urbanisation ---- “City “City “City “City as a Customer”as a Customer”as a Customer”as a Customer”
Mega Trend 1:Mega Trend 1:Mega Trend 1:Mega Trend 1:
Urbanisation Urbanisation Urbanisation Urbanisation ---- “City “City “City “City as a Customer”as a Customer”as a Customer”as a Customer”
6
China to have 13 Mega Cities That Will Contribute $6.24 Trillion to China to have 13 Mega Cities That Will Contribute $6.24 Trillion to China to have 13 Mega Cities That Will Contribute $6.24 Trillion to China to have 13 Mega Cities That Will Contribute $6.24 Trillion to the Total GDP in 2025the Total GDP in 2025the Total GDP in 2025the Total GDP in 2025
By 2025, 921 Million people (65.4% of China’s Population) will Live in Cities (equals to 2.6 times of By 2025, 921 Million people (65.4% of China’s Population) will Live in Cities (equals to 2.6 times of By 2025, 921 Million people (65.4% of China’s Population) will Live in Cities (equals to 2.6 times of By 2025, 921 Million people (65.4% of China’s Population) will Live in Cities (equals to 2.6 times of U.S. Total Population)U.S. Total Population)U.S. Total Population)U.S. Total Population)Mega cities in 2025
Emerging mega cities in 2025 (4-8 million population)
Beijing, 22.6
Tianjin, 11.9
Haerbin, 8.2
Dalian
Ulumuqi
TiayuanShijiazhuang
Qingdao
Shenyang
Changchun
Wuhan, 12.7
Source: Department of Economics and Social Affairs, United Nations; International
Institute of Applied System Analysis; Frost & Sullivan
Shanghai, 28.4
Hangzhou, 8.5
Guangzhou ,15.5
Shenzhen,15.6
Hong Kong, 8.2Foshan, 9.8
Dongguan
Shantou
Zhongshan
WuxiSuzhou
Ningbo
Kunming
Xiamen
Wenzhou
Changsha
Xi’an
Hefei
ZhengzhouJinan
Wuhan, 12.7
Nanjing, 8.5
Note: Mega City is defined as a city with population of over 8 million and GDP
of $250 billion or more. The figures represent population in Million
No. of
Province
Urbanization
Rate
% in Country
Urban
Population
3 >80% 6.9 %
5 70 – 79 % 28.3%
7 60 - 69% 26.4%
14 50 - 59% 36.3%
2 < 50 % 2.1%
Chongqing ,13.6
Chengdu, 10.0
7
China to Have 6 Mega Corridors and 3 Transportation Corridors in China to Have 6 Mega Corridors and 3 Transportation Corridors in China to Have 6 Mega Corridors and 3 Transportation Corridors in China to Have 6 Mega Corridors and 3 Transportation Corridors in 2025202520252025
Beijing-Harbin & Dalian (48)
Jiaozhou-Shijiazhuang (20)
Xuzhou-Lanzhou (20)
Beijing-Shanghai (94)
8
Note: The figures in brackets represent population in Million
Mega Corridors are corridors that connect two major cities or Mega Regions (60 km or more apart, and with a combined population of 25 million or more). The corridors can be planned economic corridors (with planned investment in transport infrastructure, industrial zones, energy, or real-estate) or naturally evolving urban corridors
Transportation Corridors are those corridors that connect Mega Cities or Mega Regions by transport links eg. Highways, rail, etc
Mega Corridor:
Mega Transportation Corridor:
Shanghai-Chengdu (122)
Ningbo-Shenzhen (78)
Beijing-Guangzhou (109)
Shanghai-Kunming (97)
Guangzhou-Shenzhen-Hong Kong (39)
Source: National Development and Reform Commission of China; Population Division, United Nations; Frost & Sullivan.
Cities, and Not Countries,Cities, and Not Countries,Cities, and Not Countries,Cities, and Not Countries,Will Drive Will Drive Will Drive Will Drive Wealth Creation Wealth Creation Wealth Creation Wealth Creation In the FutureIn the FutureIn the FutureIn the Future
Cities like Seoul account for 50% of the country’s GDP; Budapest (Hungary) and Brussels (Belgium) each for roughly 45%.
What are the Micro Implications?
High Economic PowerHub and Spoke Business ModelTransit oriented developmentNew Mobility SolutionsCity as a Customer
9
Mega Mega Mega Mega Trend 2Trend 2Trend 2Trend 2: : : :
Smart Smart Smart Smart is the New is the New is the New is the New GreenGreenGreenGreen
Mega Mega Mega Mega Trend 2Trend 2Trend 2Trend 2: : : :
Smart Smart Smart Smart is the New is the New is the New is the New GreenGreenGreenGreen
Smart Factory of the Future in ChinaSmart Factory of the Future in ChinaSmart Factory of the Future in ChinaSmart Factory of the Future in China
Virtual Planning and Virtual Planning and Virtual Planning and Virtual Planning and SimulationSimulationSimulationSimulation
Robotics Robotics Robotics Robotics ManufacturingManufacturingManufacturingManufacturing
Augmented RealityAugmented RealityAugmented RealityAugmented RealityEg. Canon’s MR systems in
Japan
12
Cloud ComputingCloud ComputingCloud ComputingCloud Computing3D Printing3D Printing3D Printing3D Printing LocationLocationLocationLocation----BasedBasedBasedBased----Services in WarehouseServices in WarehouseServices in WarehouseServices in Warehouse
Mega Trend 3:Mega Trend 3:Mega Trend 3:Mega Trend 3:
Social TrendsSocial TrendsSocial TrendsSocial Trends
Mega Trend 3:Mega Trend 3:Mega Trend 3:Mega Trend 3:
Social TrendsSocial TrendsSocial TrendsSocial Trends
Gen YGen YGen YGen YGeo Geo Geo Geo SocializationSocializationSocializationSocialization
HukouHukouHukouHukou System System System System Reform and Reform and Reform and Reform and OneOneOneOne----Child Child Child Child
Surge in Surge in Surge in Surge in Asian Work Asian Work Asian Work Asian Work
PoolPoolPoolPool
PersonalPersonalPersonalPersonal
Robots Robots Robots Robots
14
“She“She“She“She----conomyconomyconomyconomy””””
Ageing Ageing Ageing Ageing PopulationPopulationPopulationPopulation
Reverse Reverse Reverse Reverse Brain DrainBrain DrainBrain DrainBrain Drain
Middle Middle Middle Middle BulgeBulgeBulgeBulge
HukouHukouHukouHukou System System System System Reform and Reform and Reform and Reform and OneOneOneOne----Child Child Child Child
PolicyPolicyPolicyPolicy
Aging China: China to Have 315 Million People Aged Over 60 by 2025 Aging China: China to Have 315 Million People Aged Over 60 by 2025 Aging China: China to Have 315 Million People Aged Over 60 by 2025 Aging China: China to Have 315 Million People Aged Over 60 by 2025 The Aging Population will Boost Healthcare, Leisure and Insurance IndustriesThe Aging Population will Boost Healthcare, Leisure and Insurance IndustriesThe Aging Population will Boost Healthcare, Leisure and Insurance IndustriesThe Aging Population will Boost Healthcare, Leisure and Insurance Industries
Population Pyramid, (China), 2012 and 2025Population Pyramid, (China), 2012 and 2025Population Pyramid, (China), 2012 and 2025Population Pyramid, (China), 2012 and 2025
(million people)
Micro OpportunitiesMicro OpportunitiesMicro OpportunitiesMicro Opportunities
Pharmaceuticals & Health Supplement
Aged Care
E-Health
Senior Tourism
He
alt
hca
reH
ea
lth
care
He
alt
hca
reH
ea
lth
care
20252025202520252012201220122012
45454545----59595959
60+60+60+60+ 308.2308.2308.2308.2202.9
271.0 314.5
RetirementRetirementRetirementRetirement
15
Source: Ministry of Civil Affairs, PRC; National Population and Family Planning Commission, PRC; Population Division, United Nation;
Note: The Population Pyramid is based on the assumption of China continuing its current birth control policies.
Senior Tourism
Senior Social Service
Elderly Education
Life Insurance
Assisted Living (e.g. Robots)
Le
isu
reL
eis
ure
Le
isu
reL
eis
ure
0000----14141414
15151515----29292929
30303030----44444444
252.9
254.9
325.2
328.1
313.5
214.9
Pro
du
cts
Pro
du
cts
Pro
du
cts
Pro
du
cts
Middle Bulge: Around 949 Million Middle Class Individuals to Middle Bulge: Around 949 Million Middle Class Individuals to Middle Bulge: Around 949 Million Middle Class Individuals to Middle Bulge: Around 949 Million Middle Class Individuals to Account for 68% of Total China’s Population in 2020Account for 68% of Total China’s Population in 2020Account for 68% of Total China’s Population in 2020Account for 68% of Total China’s Population in 2020
2020202020202020
1396.2 1396.2 1396.2 1396.2 million million million million IndividualsIndividualsIndividualsIndividuals
1,348.9 1,348.9 1,348.9 1,348.9 million million million million IndividualsIndividualsIndividualsIndividuals
2010201020102010
UpperUpperUpperUpper----Middle Middle Middle Middle ClassClassClassClass
AffluentAffluentAffluentAffluent
RichRichRichRich
Household Disposal Household Disposal Household Disposal Household Disposal Income Income Income Income Per AnnumPer AnnumPer AnnumPer Annum
$100,000$100,000$100,000$100,000
0.2%0.2%0.2%0.2%(3)(3)(3)(3)
0.1%0.1%0.1%0.1%((((1.5)1.5)1.5)1.5)
0.4%0.4%0.4%0.4%((((4.9)4.9)4.9)4.9)
$60,000$60,000$60,000$60,00010.3%10.3%10.3%10.3%
((((144.0)144.0)144.0)144.0)
0.6%0.6%0.6%0.6%
((((8.4)8.4)8.4)8.4)
7%7%7%7%((((91.7)91.7)91.7)91.7)
16
Source: Statistic Bureau of China, 2010; Euromonitor; Population Division, United Nations; Frost & Sullivan
Note: Note: Figures in the brackets are millions of individuals. The average household size in China is approximately 3. Percentage numbers do not add up to 100% because of rounding. Disposal Income = actual income that can be used for final consumption, non-compulsory expenditure and savings
$10,000$10,000$10,000$10,000
PoorPoorPoorPoor
Lower Middle ClassLower Middle ClassLower Middle ClassLower Middle Class
Middle ClassMiddle ClassMiddle ClassMiddle Class
UpperUpperUpperUpper----Middle Middle Middle Middle ClassClassClassClass
Below Poverty Below Poverty Below Poverty Below Poverty LineLineLineLine
64%64%64%64%
((((861.2)861.2)861.2)861.2)
14%14%14%14%
((((189.4)189.4)189.4)189.4)
14.7%14.7%14.7%14.7%
((((205.0)205.0)205.0)205.0)
29.7%29.7%29.7%29.7%
(414.5)(414.5)(414.5)(414.5)
43.0%43.0%43.0%43.0%
((((600.0)600.0)600.0)600.0)
1.5%1.5%1.5%1.5%
(21.4)(21.4)(21.4)(21.4)Poverty LinePoverty LinePoverty LinePoverty Line
$22,000$22,000$22,000$22,000
10.3%10.3%10.3%10.3%
((((144.0)144.0)144.0)144.0)
7%7%7%7%((((100.8)100.8)100.8)100.8)
7%7%7%7%((((99.5)99.5)99.5)99.5)
7%7%7%7%((((91.7)91.7)91.7)91.7)
$1,000$1,000$1,000$1,000
$7,500$7,500$7,500$7,500
Six Degrees Apart: Six Degrees Apart: Six Degrees Apart: Six Degrees Apart: Social Networking Users to Reach 488 Social Networking Users to Reach 488 Social Networking Users to Reach 488 Social Networking Users to Reach 488 Million in China by 2015Million in China by 2015Million in China by 2015Million in China by 2015
Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese NetizensNetizensNetizensNetizens will be Involved in Social Networking Serviceswill be Involved in Social Networking Serviceswill be Involved in Social Networking Serviceswill be Involved in Social Networking Services
Social Network SitesSocial Network SitesSocial Network SitesSocial Network Sites
350.5million244.2
million
MicroMicroMicroMicro----blogsblogsblogsblogs
364.5million249.9
million
2011201120112011 2015201520152015Users of Top Social Networking Services, (China), Users of Top Social Networking Services, (China), Users of Top Social Networking Services, (China), Users of Top Social Networking Services, (China), 2011 and 20152011 and 20152011 and 20152011 and 2015
NonNonNonNon----Internet UsersInternet UsersInternet UsersInternet Users
Internet UsersInternet UsersInternet UsersInternet Users
513.4 513.4 513.4 513.4 millionmillionmillionmillion
841.9 841.9 841.9 841.9 millionmillionmillionmillion
1111Total: Total: Total: Total: 1,355.2 1,355.2 1,355.2 1,355.2 millionmillionmillionmillionTotal: Total: Total: Total: 1,355.2 1,355.2 1,355.2 1,355.2 millionmillionmillionmillion Total: Total: Total: Total: 1,377.8million1,377.8million1,377.8million1,377.8millionTotal: Total: Total: Total: 1,377.8million1,377.8million1,377.8million1,377.8million
NonNonNonNon----Internet UsersInternet UsersInternet UsersInternet Users
Internet UsersInternet UsersInternet UsersInternet Users701 701 701 701 millionmillionmillionmillion
676.8 million676.8 million676.8 million676.8 million
2222
17
20152015201520152011201120112011 20152015201520152011201120112011
Media SharingMedia SharingMedia SharingMedia Sharing
2015201520152015
455.7million
2011201120112011
325.31 million
SocialSocialSocialSocial----gaminggaminggaminggaming
2015201520152015
427.6million
2011201120112011
324.28 million
194.68million
318.8 318.8 318.8 318.8 millionmillionmillionmillion
Non Social Non Social Non Social Non Social Networking Networking Networking Networking UsersUsersUsersUsers
Social Social Social Social Networking Networking Networking Networking UsersUsersUsersUsers
213million
Non Social Non Social Non Social Non Social Networking Networking Networking Networking
UsersUsersUsersUsers
Social Social Social Social Networking Networking Networking Networking
UsersUsersUsersUsers
Source: World Bank 2011; China Internet Network Information Center, PRC; Frost & Sullivan
3333 4444
Note: the predictions of user number are based on current growth and market share
488 488 488 488 millionmillionmillionmillion
Mega Trend 4:Mega Trend 4:Mega Trend 4:Mega Trend 4:
Connectivity Connectivity Connectivity Connectivity & & & & ConvergenceConvergenceConvergenceConvergence
Mega Trend 4:Mega Trend 4:Mega Trend 4:Mega Trend 4:
Connectivity Connectivity Connectivity Connectivity & & & & ConvergenceConvergenceConvergenceConvergence
10 Connected Devices for 10 Connected Devices for 10 Connected Devices for 10 Connected Devices for Every Every Every Every Household by 2020Household by 2020Household by 2020Household by 2020
5 connected devices for every 5 connected devices for every 5 connected devices for every 5 connected devices for every user user user user by 2020by 2020by 2020by 2020
80 Billion Connected Devices 80 Billion Connected Devices 80 Billion Connected Devices 80 Billion Connected Devices By 2020By 2020By 2020By 2020
5 billion 5 billion 5 billion 5 billion internet users by internet users by internet users by internet users by 2020202020202020
500 devices with unique 500 devices with unique 500 devices with unique 500 devices with unique digital IDs (Internet of things) digital IDs (Internet of things) digital IDs (Internet of things) digital IDs (Internet of things) per square per square per square per square kilometre by 2020kilometre by 2020kilometre by 2020kilometre by 2020
Source: Frost & Sullivan, 2012
19
China to Launch 211 Satellites before 2017China to Launch 211 Satellites before 2017China to Launch 211 Satellites before 2017China to Launch 211 Satellites before 2017China to See it’s Own Space Station by 2020China to See it’s Own Space Station by 2020China to See it’s Own Space Station by 2020China to See it’s Own Space Station by 2020
Chang’e Project
Kuafu ProjectSolar act. observation
2003-12
Shenzhou-9&102012
Tiangong-2 &32012-16
China’s 1st
Space Station2020
20
Accumulated No. By 2011 By 2017
Sate
llite
sCommunication Satellite 29
111 211
Navigation Satellite 14
Earth Observation Satellite 38
Science R&D Satellite 16
Probe Satellite 14
Space Missions 150* 250
Space Centers & Units 3 4*Note: The numbers indicates successful launches
Source: CNSA; China Great Wall Industry Corporation; Frost & Sullivan
Chang’e ProjectLunar exploration
2003-23100 Rockets 100
Satellites Project
2011-16
Augmented RealityAugmented RealityAugmented RealityAugmented Reality
Augmented Reality (AR) is defined as a real-time augmented view of the environment through digital data through use of text, sound, graphics, video, and navigation systems that increases user’s interactivity with the local environment . This extends business and mobility options, social interactions and experiences which has implications on personal lives, businesses and even day-to-day activities.
21
RealityRealityRealityRealityAugmented Augmented Augmented Augmented
RealityRealityRealityRealityAugmented Augmented Augmented Augmented VirtualityVirtualityVirtualityVirtuality Virtual WorldVirtual WorldVirtual WorldVirtual World
Augmented Reality Impacting Different Augmented Reality Impacting Different Augmented Reality Impacting Different Augmented Reality Impacting Different Personal ExperiencesPersonal ExperiencesPersonal ExperiencesPersonal Experiences
Source: Frost & Sullivan, 2012
22
YihaodianYihaodianYihaodianYihaodian Plans Plans Plans Plans 1000 Augmented Reality Stores 1000 Augmented Reality Stores 1000 Augmented Reality Stores 1000 Augmented Reality Stores in Chinain Chinain Chinain China
“Unlimited Yihaodian” stores (1,200 square meters) use unused city spaces and stock around 1,000 items.
23
Mega Trend 5:Mega Trend 5:Mega Trend 5:Mega Trend 5:Bricks and ClicksBricks and ClicksBricks and ClicksBricks and Clicks
Mega Trend 5:Mega Trend 5:Mega Trend 5:Mega Trend 5:Bricks and ClicksBricks and ClicksBricks and ClicksBricks and Clicks
5,000
6,000
7,000
8,000
2018-2019: China to
surpass US, the later
2.8x
Market
China Retail Sales to Account over 1/3 of the World in 2025China Retail Sales to Account over 1/3 of the World in 2025China Retail Sales to Account over 1/3 of the World in 2025China Retail Sales to Account over 1/3 of the World in 2025China is to Surpass US to be the Largest Retail Market before 2020China is to Surpass US to be the Largest Retail Market before 2020China is to Surpass US to be the Largest Retail Market before 2020China is to Surpass US to be the Largest Retail Market before 2020
$2.8
$4.1
$5.2
2011
2015
2020
2025
7.29
Retail Sales Per Capita
($ thousand)
Na
tio
na
l Re
tail
Sa
les
($ t
rill
ion
)
0
1,000
2,000
3,000
4,000
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
surpass US, the later
will have total retail
sales of $4.9-5 trillion
Market
Value
25
$1.8
25
2.542.81
Na
tio
na
l Re
tail
Sa
les
($ t
rill
ion
)
Retail Sales(Offline) Retail Sales(Online B2C) Note: Some numbers do not add up because of the rounding.
Source: World Bank; Prudential Real Estate Investors; Economic Intelligence
Unit; McKinsey & Company; National Bureau of Statistics, PRCNote: The market size includes only B2C sales and does not include
C2C
The Retail Model Will Evolve From a Single/Multiple Channel Model to an The Retail Model Will Evolve From a Single/Multiple Channel Model to an The Retail Model Will Evolve From a Single/Multiple Channel Model to an The Retail Model Will Evolve From a Single/Multiple Channel Model to an Integrated Cross Channel Model Integrated Cross Channel Model Integrated Cross Channel Model Integrated Cross Channel Model
Department
Stores
Supermarkets Hypermarkets Online Mobile Payments Mobile Apps
Bricks (preBricks (preBricks (preBricks (pre----2000)2000)2000)2000) +Advent of Clicks (post+Advent of Clicks (post+Advent of Clicks (post+Advent of Clicks (post----2000)2000)2000)2000)
Source: Frost &
Sullivan Analysis
Interactive StoresVirtual Stores Hyper Online
Markets
The Future The Future The Future The Future ---- Bricks and Clicks (2015 and Beyond)Bricks and Clicks (2015 and Beyond)Bricks and Clicks (2015 and Beyond)Bricks and Clicks (2015 and Beyond)
26
Mega Trend 6:Mega Trend 6:Mega Trend 6:Mega Trend 6:
Economic TrendsEconomic TrendsEconomic TrendsEconomic Trends
Mega Trend 6:Mega Trend 6:Mega Trend 6:Mega Trend 6:
Economic TrendsEconomic TrendsEconomic TrendsEconomic Trends
16.9816.70
25.11
10.98
20.76
38.88
China’s GDP To Reach $38 Trillion by 2025 Making It The China’s GDP To Reach $38 Trillion by 2025 Making It The China’s GDP To Reach $38 Trillion by 2025 Making It The China’s GDP To Reach $38 Trillion by 2025 Making It The Largest Economy in the WorldLargest Economy in the WorldLargest Economy in the WorldLargest Economy in the World
1111Largest economy Largest economy Largest economy Largest economy
in the worldin the worldin the worldin the world
0.47 0.871.37
2.43
6.15
8.84
12.39
16.98
10.46
16.7010.98
28
Note: The value shown as GDP & Population People’s Republic of China, including Hong Kong SAR & Macao SAR. GDP at Current Prices based on 2011 numbers.Appreciation of the Renmibi currency and inflation are factored into the GDP forecast.
Source: International Monetary Fund; World Bank 2012; Prudential Real Estate Investors; The Economist 2011; National Development & Reform Commission of China; Frost &
Sullivan
$ Trillion
Nominal GDP GrowthNominal GDP GrowthNominal GDP GrowthNominal GDP Growth 1990199019901990 1995199519951995 2000200020002000 2005200520052005 2010201020102010 2015201520152015 2020202020202020 2025202520252025
Optimistic (12-14%)
Frost & Sullivan (8-9%)
Conservative (5-7%)
(Optimistic Scenario)
29
Mega Trend Mega Trend Mega Trend Mega Trend 7: 7: 7: 7:
Future Infrastructure Future Infrastructure Future Infrastructure Future Infrastructure DevelopmentDevelopmentDevelopmentDevelopment
Mega Trend Mega Trend Mega Trend Mega Trend 7: 7: 7: 7:
Future Infrastructure Future Infrastructure Future Infrastructure Future Infrastructure DevelopmentDevelopmentDevelopmentDevelopment
837.9
553.3
800
1000
1200
1400
1600
1800
553.35
110.67
142.2951.38
252.96
316.20
China Infrastructure Spending to Grow to China Infrastructure Spending to Grow to China Infrastructure Spending to Grow to China Infrastructure Spending to Grow to $2.7 Trillion $2.7 Trillion $2.7 Trillion $2.7 Trillion (2011(2011(2011(2011----2015)2015)2015)2015)
117.52111.61
49.94147.16
133.34
2011201120112011----2015201520152015
$2,739 billion$2,739 billion$2,739 billion$2,739 billion
2006200620062006----2010201020102010
$2,365 billion$2,365 billion$2,365 billion$2,365 billion
2006-2010 (11th Five Year Plan)
2011-2015 (12th Five Year Plan)
Infrastructure Investments (on fixed assets), (China), 2006Infrastructure Investments (on fixed assets), (China), 2006Infrastructure Investments (on fixed assets), (China), 2006Infrastructure Investments (on fixed assets), (China), 2006----2015201520152015
747.2
360.7
697.9
117.5 111.6 49.9147.2 133.3
474.3
110.7 142.351.4
253.0 316.2
0
200
400
600
Power supply
Railway Roads Urban Public Transport
Water Transport
Air Transport
Telecomm Water Conservation 837.93
474.30
553.35
31
747.16
360.71
697.88
Source: National Development and Reform Commission, PRC; National Bureau of Statistics, PRC; Ministry of Housing and Rural-Urban Development, PRC; Asian Logistics and Maritime Conference, 2011; KPMG, 2011; Ministry of Transport, PRC; Ministry of Railways, PRC; Credit Suisse; Frost & Sullivan, 2012
RailwayRailwayRailwayRailway RoadsRoadsRoadsRoads Urban Public TransportUrban Public TransportUrban Public TransportUrban Public Transport Water TransportWater TransportWater TransportWater Transport
Water ConservationWater ConservationWater ConservationWater ConservationAviationAviationAviationAviation TelecommTelecommTelecommTelecomm
Power SupplyPower SupplyPower SupplyPower Supply
Note: all numbers in charts represent billion USD. RMB:USD=0.1581:1 as nominal value by 2012
High Speed Rail High Speed Rail High Speed Rail High Speed Rail to See the Largest Expansion in Chinato See the Largest Expansion in Chinato See the Largest Expansion in Chinato See the Largest Expansion in ChinaChina to Invest $553.5 Billion to Extend the High Speed Rail Network to China to Invest $553.5 Billion to Extend the High Speed Rail Network to China to Invest $553.5 Billion to Extend the High Speed Rail Network to China to Invest $553.5 Billion to Extend the High Speed Rail Network to
16,000 Km by 2020 (expected 25,000 Km in 2025)16,000 Km by 2020 (expected 25,000 Km in 2025)16,000 Km by 2020 (expected 25,000 Km in 2025)16,000 Km by 2020 (expected 25,000 Km in 2025)
ShenyangShenyangShenyangShenyang
ShijiazhuangShijiazhuangShijiazhuangShijiazhuang
Source: National Development and Reform Commission of China; International Institute of Urban Development, Beijing; Ministry of Railway of China; Ministry of Railway of China; Frost & Sullivan, 2012
JinanJinanJinanJinan
ZhengzhouZhengzhouZhengzhouZhengzhou
NanjingNanjingNanjingNanjing
ChangshaChangshaChangshaChangshaHangzhouHangzhouHangzhouHangzhou
XianXianXianXian
Emerging traffic hub in 2015-2020
NanchangNanchangNanchangNanchang
LanzhouLanzhouLanzhouLanzhou
KunmingKunmingKunmingKunming200200200200----250 km/h250 km/h250 km/h250 km/h
300300300300----350 km/h350 km/h350 km/h350 km/h
160160160160----200 km/h200 km/h200 km/h200 km/h
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Mega Trend Mega Trend Mega Trend Mega Trend 8: 8: 8: 8:
Top Industries of Top Industries of Top Industries of Top Industries of The FutureThe FutureThe FutureThe Future
Mega Trend Mega Trend Mega Trend Mega Trend 8: 8: 8: 8:
Top Industries of Top Industries of Top Industries of Top Industries of The FutureThe FutureThe FutureThe Future
Top Industries in China in 2025Top Industries in China in 2025Top Industries in China in 2025Top Industries in China in 2025
FinanceFinanceFinanceFinanceTo Gain 40% of IPOs over
US & UK by 2020
ConstructionConstructionConstructionConstructionworlds’ largest construction
market since 2010
RetailRetailRetailRetailBecoming worlds’ largest
by 2019
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AutomotiveAutomotiveAutomotiveAutomotiveWorld’s largest car market
since 2009
FinanceFinanceFinanceFinanceTo Gain 40% of IPOs over
US & UK by 2020
ConstructionConstructionConstructionConstructionworlds’ largest construction
market since 2010
AviationAviationAviationAviationTo become world’s largest
after 2025
Photo Credits: Dreamstime
RetailRetailRetailRetailBecoming worlds’ largest
by 2019
LogisticsLogisticsLogisticsLogisticsBecoming worlds’ largest
by 2016
Luxury GoodsLuxury GoodsLuxury GoodsLuxury GoodsBecoming world’s 2nd largest
by 2016
Note: All industries have been analyzed in detail in the report
So what will the So what will the So what will the So what will the futurefuturefuturefuture look like in 2025look like in 2025look like in 2025look like in 2025
1.1.1.1. Every 1 in 3 homes in China will have a personal robot. Every 1 in 3 homes in China will have a personal robot. Every 1 in 3 homes in China will have a personal robot. Every 1 in 3 homes in China will have a personal robot.
2.2.2.2. Digital Assistants Digital Assistants Digital Assistants Digital Assistants will guide our everyday liveswill guide our everyday liveswill guide our everyday liveswill guide our everyday lives
3.3.3.3. Fortune 500 list will have 200 companies from China (72 in 2012)Fortune 500 list will have 200 companies from China (72 in 2012)Fortune 500 list will have 200 companies from China (72 in 2012)Fortune 500 list will have 200 companies from China (72 in 2012)
4.4.4.4. Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese netizensnetizensnetizensnetizens will be involved in social networking will be involved in social networking will be involved in social networking will be involved in social networking
services services services services
5.5.5.5. We will have multiple devices monitoring our We will have multiple devices monitoring our We will have multiple devices monitoring our We will have multiple devices monitoring our well being well being well being well being andandandand wonder wonder wonder wonder
4.4.4.4. Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese Around 70% of Chinese netizensnetizensnetizensnetizens will be involved in social networking will be involved in social networking will be involved in social networking will be involved in social networking
services services services services
5.5.5.5. We will have multiple devices monitoring our We will have multiple devices monitoring our We will have multiple devices monitoring our We will have multiple devices monitoring our well being well being well being well being andandandand wonder wonder wonder wonder
and designer drugs and designer drugs and designer drugs and designer drugs will be common placewill be common placewill be common placewill be common place
6.6.6.6. China will be the China will be the China will be the China will be the top super power top super power top super power top super power in terms of impact to trade and in terms of impact to trade and in terms of impact to trade and in terms of impact to trade and
investment.investment.investment.investment.
35
MacroMacroMacroMacro MicroMicroMicroMicro
From Macro to Micro: Taking Mega Trends from Information to From Macro to Micro: Taking Mega Trends from Information to From Macro to Micro: Taking Mega Trends from Information to From Macro to Micro: Taking Mega Trends from Information to Strategy ImplementationStrategy ImplementationStrategy ImplementationStrategy Implementation
Mega TrendMega TrendMega TrendMega TrendSelected trends that impact your
business and markets
Analysis of Opportunities and Analysis of Opportunities and Analysis of Opportunities and Analysis of Opportunities and Unmet NeedsUnmet NeedsUnmet NeedsUnmet Needs
ToToToTo
Sub TrendSub TrendSub TrendSub TrendA sub-layer of trends that has a
wide ranging impact
Impact to Your IndustryImpact to Your IndustryImpact to Your IndustryImpact to Your IndustryVisualising the roadmap of these critical forces through scenario-
building and macro economic forecasts
Impact on Future Product/ Impact on Future Product/ Impact on Future Product/ Impact on Future Product/ TechnologyTechnologyTechnologyTechnology
36
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Contact Contact Contact Contact InformationInformationInformationInformation
Sarwant SinghPartner & Practice Director, Visionary Innovation
Research Group and Automotive & Transportation
(+44) 2079157843
Sarwant SinghPartner & Practice Director, Visionary Innovation
Research Group and Automotive & Transportation
(+44) 2079157843
Archana AmarnathProgram Manager, Visionary Innovation Research
Group
(+44) 2079157893
Archana AmarnathProgram Manager, Visionary Innovation Research
Group
(+44) 2079157893
Dr. Neil WangPartner & Managing Director, China
(+86) 2132098895
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Marcia Chao-Mei ChiuResearch Analyst
(+44) 2073438385