AIA China and the World Economic Transformation through Structural Reforms
The middle-income group is crucial to social stability. In many countries, however, this group of people find it hard to sustain their living standards and social status, and as a result the anxiety among them is increasing.
This paper will address the issue of middle class anxieties from four different perspectives.
1. Differences between Advanced and Developing Countries.
2. Economics and Social Consequences.
3. Measures to Relieve Anxiety.
4. International Experiences Relevant to China.
This report relies on data from AIA’s proprietary survey of the middle class in key Asian markets, including China, as well as research from the World Bank, IMF, academic, and other sources.
The middle class in the US and Europe has seen incomes stagnate and anxieties increase under globalisation.
Asian middle classes on the contrary have seen incomes expand.
China, in particular, has a relatively young or “first generation” middle class. Moreover, China’s middle class is confident about its ability to continue to expand and generally positive about life, health, and wealth in the country.
The Chinese middle class will continue to increase consumption, even as economic growth slows, per the pattern seen elsewhere in East Asia. It will also continue to purchase life insurance at an increasing pace, again similar to the pattern observed in East Asia.
Deepening of economic reform will assist China’s middle class continue to maintain a relatively positive outlook and relieve potential anxiety.
Developing the insurance sector in a sustainable public-private basis will advance both the goal of deepening economic reform and maintaining a positive outlook for the middle class.