China put its mark in the Latin American history books with President Xi Jinping promising to give $250 billion dollars in an unexpected venture! Latin America can now build not one, but two space stations and have money to spare for a rocket or two! How do you invest in a country that has invested so much in others? Well, like every other country, it has hidden gems that wait to get discovered and polished!
First of all, you can’t use the same tactics as other countries because China is unlike any other. Investing in sectors with sustainable growth such as IT, electronics, industrials, and consumer goods has become overcrowded. Investors need to focus on alternative areas such as the financial sectors, real estate and the vast array of state-owned enterprises. In fact, a study conducted by Gavekal Dragonomics show that you will see higher returns on your investment in state-owned and not non-state-owned firms.
If you dig a bit deeper, you may find gems in unexpected and untapped markets. A Forbes interview with Hans Tung, who is one of China’s top investors, reveals that there is a lot of opportunity in the mobile marketing sector, which may potentially obliterate or force serious streamlining of the offline selling of goods and services. This opportunity will span across many sectors such as education, healthcare, transport, tourism, etc.
The Shanghai-Hong Kong Stock Connect program has opened a gateway to China’s previously elusive stock market. New reforms allow trading yuan outside of China, which makes cash flow easier for foreign investors. Experts warn investors to tread lightly since it is relatively new and riddled with glitches and insider dealings that can manipulate the market. In addition, there is a limitation on transparency between a few companies and their investors.
Times are changing for China, and remarkable new opportunities are bringing them into the growing global market. A careful analysis could show you where the markets are blossoming, and you could take advantage of some of the best financial gems which could be mined .
Written by: Mae Merriweather
Editor: Derin Cag (Founder & CEO – Richtopia.com)