China's pool of high-earning consumers is set to surge in the next 15 years, their household spending growing to be greater than the Europe Union's current level, a report showed.
The number of people earning more than 10,000 U.S. dollars per year is expected to grow to around 480 million by 2030, from around 132 million today, according to research by the Economist Intelligence Unit (EIU), a think tank with the Economist.
The proportion of the population with upper-middle and high incomes will expand from 10 percent to 35 percent by 2030 when China will look and feel like a more middle-class society, although inequalities in wealth will remain an important social challenge, the report pointed out.
"We expect that the purchasing power of individual Chinese consumers in 2030 will be roughly akin to that of South Korea today or the U.S. in 2000," said Wang Dan, EIU China Analyst.
Some interior cities will become major centers of consumption, with Changsha, Chengdu, Chongqing and Wuhan each having over 2 million high-income consumers by 2030. However, other smaller cities may be left behind as regional inequalities persist.
The report pointed out that despite concerns for China's economic slowdown, it is important to remember that China is still in the early to middle stages of development in terms of consumption spending.
With rising income, Chinese consumers will look to upgrade consumption habits and switch to more expensive and premium brands when buying items such as cars and mobile devices, as well as driving higher spending on service sectors such as leisure and tourism, health, education and finance, the report showed.
"China's consumer economy is set for an exciting period of development and expansion," Wang added.
