The rise of the ‘China angle’ is our next event focus, driven by seven catalysts:
- Capital controlled by Chinese-Australians are now being redeployed in a wider array of investments, not just property.
- Downward asset revaluations after decades of ‘it can only rise’ means the older generation who made decisions are increasingly transferring power to the next generation.
- The cost and supply of capital is tighter due to tougher transfer controls in China. So leveraging the China consumption angle, and the supply chain opportunities, is key to making this capital work harder.
- The trade war negotiations and a dramatic turnaround for China to now seek foreign capital, are speeding up Chinese reforms which will benefit cross-border deals.
- These reforms focus on China’s 3 internal battles (a war on poverty, pollution, and financial risk…ie boosting the ‘wellness’ of the general population). This reformation is a tailwind for Australia’s financial and wealth management services, ‘food creators’ (more nuanced than ‘farmers’), health/wellness/aging and alternative energy.
- The Chinese diaspora, including wealthier business and skilled migrants, compared to family reunion migrants from decades ago, are now creating more business and investment opportunities. Capital already in Australia is a key
- The US economic and political rivalry with China is the ‘grey rhino’ and ‘collateral damage’ risk. However Australia benefits from the tailwind of China’s GDP still strong growth, a growing middle class, Belt and Road infrastructure projects that consumes Australian iron ore and coal, and a positive Brand Australia that attracts tourists and students.
I will be discussing these topics in our ‘China Angle’ events, sponsored by Deloitte, beginning in Brisbane on 10 May and Perth on 22 May, with more cities to be announced.
Click here to register for the China angle seminars.
My co-speaker, Tim Cheung, co-founder of China focussed hedge fund LSL Partners, will be delving into the Chinese consumer and tech opportunities