Consumer led economic recovery

 Over the next decade, more than half of the growth in global consumption is expected to come from the middle class—most of which will be new entrants to the middle class. Hundreds of millions more consumers will have purchasing power that extends beyond their basic needs. As their incomes grow, family budgets will also shift as they add new amenities to their middle class lifestyle (such as apparel and restaurant spending), or aspire to purchase global brands for the first time.

Visa’s new study looks at these and other trends in global consumption, including a comparison of globalization level for cities and countries around the world. One key metric of globalization is the size of a city’s middle class, because a vibrant middle class and urban affluence create larger and stronger markets. As less globalized cities close their “globalization gap” with highly globalized cities, new international business opportunities are likely to emerge.

The study explores the tremendous changes that are occurring in the geography of urban consumption, including the convergence of technology and living standards that have brought consumers from around the world closer together. Using “big data,” the study identifies how urban centers and the consumers that live in them could be impacted by ongoing demographic and technology trends. Understanding these trends, will enable companies to better plan and forecast for business growth.

It is predicted new centres of middle class consumers will drive up demands of goods so that emerging middleclass from Shanghai to StPetersburg will spur consumer led economic gtowth.look at the example of Shanghai.to boost post pandemic economic recovery,the authorities are giving incentives like lower govt tax and more subsidies to small businesses.

Look at what Malaysia is doing?the authorities are imposkng tax on low value goods purchased via e commerce sites.The likely scenario is it will kill off the small home based enterprises of self employed from creative uniquely designed clothing,bags and etc to artisan baked goods.

Why tax the middle class and low income groups of M40 and T40 and not impose tax on high value goods above rm2,000 on the T20 rich consumers.? The M40 n T40 make up the majority support base of an elected government and the voters will use the ballot box to show their dissatisfaction with bread n butter issues.

giving cash handouts is not a long term solution but its like give a man a fish and he has food for a day but teach a man how to fish and he has food for a lifetime..the policies of shiok sendiri will not have long term sustainbility and not viable.

There must be better coordination between different ministries to drive changes at macro and micro level.piecemeal policies are bound for doomsville.