The year 2018 was apparently not the best year we had. In Australia, we are very fortunate to witness only a mild backslide in the stock and property market compared to the rest of the world, while the mining and tourism maintain stable. In China, almost all major industries and investment sectors had a downfall, forcing Chinese capital to hibernate.
“If Winter comes, can Spring be far behind?”, probably. China’s best-selling financial writer — Mr. Xiaobo Wu confirms in his cross-year speech on December 30, 2018 that the opportunity will abide in storms in the year to come.
Wu Xiaobo—China’s No.1 Mastermind in Financial World
Inside China’s business and journalism circles, Wu Xiaobo has been a household name for nearly two decades. Long considered the best business writer in China, he is the author of some of the country’s best-selling books on business and economics. In 2009, Wu Xiaobo was named “China’s Annual Young Leader” by Southern People Weekly. The title came as the latest addition to his pile of labels already given by friends and readers – “talented”, “humble”, “optimistic” and “handsome”, to name a few.
Born in 1968 in Ningbo, Zhejiang province, Wu Xiaobo loved reading from a young age and completed his bachelor degree in Journalism at Fudan University, one of China’s top institutions. Further down the road, he became a journalist and a writer. Wu Xiaobo also occasionally took on other academic roles, including visiting scholar at Harvard and EMBA professor at Shanghai Jiaotong University.
Looking at his success over the years, Wu Xiaobo was most grateful for the experience at Xinhua News Agency, where he started his First job as a business journalist for 13 years. Xinhua provided Wu with top-quality professional training in journalism as well as a powerful platform connecting him to all types of interviewees with big names.
Looking back at those years as a journalist, Wu recalled having a particular preference for writing analyses and drawing constructive hindsight on economic events. As such, when he reached the “ceiling” as a journalist and had to decide between entering management or becoming a columnist or writer, Wu chose writer.
“I did it because I love writing. That’s where my passion lies.”
But what are the key points about the 2019 trend forecast? Read on.
100 Years from 1919-2018:
In 2018, we had a very unforgettable year. It was also the fourth year of Wu’s social media business. This year marks the 40th anniversary of the reform and opening up.
Every era has its opportunities. Many people have such questions. Is our generation more trustworthy than the previous generation? I don’t think there is a definitive answer to this. What we have to ask ourselves is whether there is still the courage to innovate. Through a century of history, each era has unique imprints and opportunities.
If you are a youth in 1919, your mission is to “wake up” your patriotism; in 1939, the anti-Japanese war was the main theme; in 1949, the young people of China had secretly studied in bed; in 1959, it was the thrilling moment of the steelworkers.
1984-1988: In the first years of Chinese business, you can seek commercial means to change your life.
1998-1999: In the first years of the Internet, Jack Ma and Pony Ma started their businesses in a great new industry —– Internet;
2012: Thanks to mobile internet and the entrepreneurs of the 80s that has began to rise.
People who are about to destroy you, have not appeared on your enemy list today.
In June 2018, McKinsey released a report that announced the next 12 technologies that will change the world: Internet of Things, 3D printing, Mobile Internet, Automated transportation, Cloud computing, Renewable Energy, New Materials, Artificial Intelligence, Energy Storage. Technology, Robotics, Genomics technology, Unconventional Oil and Gas exploration technology. These areas are important ones where changes will take place.
In 2018, change brought us a lot of explanations and possibilities. The ‘Blockchain’ is not only the most disappointing economic term in 2018 but also the detonation zone of the next generation information revolution.
This year marks the 40th anniversary of reform and opening up, but neither reform nor opening reach the expectation of what we want. Therefore, facing the future, in the good and bad situations, it is the mission of this generation to carry out the great ‘reform and opening up’.
5 Questions Marks left by 2018
1. When will the Sino-US trade war be concluded?
In the next 12 to 15 years, China’s GDP is likely to exceed the United States. In the future, the United States’ five major attack areas for the Chinese economy include: Made in China 2025, One Belt and One Road, Internet Finance, RMB Internationalization and 5G technology Commercialization.
2. What shall reactivate the investment?
The problem in 2018 is that entrepreneurs don’t know what to buy and the sharp decline in entrepreneurial investment. The most important point is whether we can restore people’s investment confidence, so we must redefine the positioning of the private economy, which was a common difficulty in the year 2018. Among them, state-owned enterprises and private enterprises have become the dual-subject role in the national economy. This is a fundamental change in our concept.
3. Was there a consumption downgrade?
More and more companies interesting headlines have stated that the era of ‘consumer grading’ (to categorize consumers into different classes) has arrived, but the consumption downgrade has indeed not come, and now the level of consumption has become more normalized.
4. Will real estate collapse?
Overall, this year, there are 67 cities with rising house prices, and only three dropped. The future of Chinese property markets is an important indicator for judging economic trends and national confidence.
5. Will entrepreneurship continue to heat up?
In 2015, the country advocated ‘Innovation + Entrepreneurship’ on a large scale. Many start-up companies prefer to flood into software, information transmission, and other IT sectors. Why did they cool down in the past two years? Some people think that the end of the mobile Internet dividend is the main reason. However,manufacturing will become a new entrepreneurial trend in the future.
Eight predictions of 2019
1. Confidence of Capital
There are three interpretations. First, the economic trend may be pessimistic. Therefore, investors will hold cash. Second, we really hope that the capital market can be reactivated next year. Third, the Sino-US trade war will become a long-term phenomenon, but this may not be a bad phenomenon for China, and it may result in forced reform and adjustments.
2. Infrastructure expansion causing unstable commodity prices
If this round of economic construction is not improved by activating the private economy, it may appear in the form of inflation. From a macro perspective, this tunnel is still relatively long and indeed worth concern.
3. A Turning Point for Manufacturing Upgrade
From clothing to household appliances/household, an inflection point in manufacturing upgrades is happening right now.
First, technology-driven upgrades form a major trend; second, customization is more and more popular; third, providing solutions becomes very important for users; fourth, a large number of enterprises are trying cross-industry businesses, value-added effects will gradually emerge among those cross-borders. Fifth, this round of economic crisis will eliminate some smaller players, and the head enterprises must strengthen their manufacturing capabilities.
4. New Craftsmanship Upgrades
This is the most exciting thing for Chinese entrepreneurs lately. There are several characteristics of new Made-in-China products:
1) A rise of confidence in products
2) The value of Appeals: Meaning buying one thing may not because
of the need, but to meet consumers’ aesthetic needs;
3) Better products reasonable prices: For a long time, China’s consumer market has been misled by a concept – “cheap but good quality”. In recent years, we have found that local elements, products that look good and not very expensive, are sold. The concept of consumption of ‘cheap and good’ is fading away.
4) Segment Market: Big and strong, small and beautiful redefines the new pattern in the Chinese market.
5. New Middle-class Driving New Consumption
The new middle class is becoming the core group of the fourth wave of migration. They are seagull-type immigrants who will get the green card in another country but stay in China.
6. Social circle members are popular
The three major business model innovations in 2019: Social circle, Private e-commerce and Membership. Social E-commerce has proved to be a successful business model in 2018, the cost of obtaining customers is getting higher and higher, and the membership system can guarantee the aggregation of the layers. These three are mutually connected.
7. The New Financial Revolution is Coming
Nowadays in China, lending to SMEs could be fairly risky, and many companies are doing it with big data and supply chain finance. Some time ago, I went to WeBank for research purposes. It starts the loan services in November last year. As of November, this year, 300,000 small and micro enterprises applied for loans, and 69% of them did not have any corporate loan records.
Think about it, if this model works in China, is it possible to have the same business in places like India? In 2019, Chinese-style micro-financial innovation will be one of a kind. If the relevant state policies allow it, it is not a dream to thoroughly solve the problem of China’s small and micro-enterprise loans within three years.
8. The car industry suddenly broke into 5G
In 2017, Car sales reached 28.87 million items in China. In 2018, there was a new turning point in industrial transformation. New energy vehicles have gained new opportunities. China’s new energy vehicles have grown from 74,700 in 2014 to 1.1 million vehicles in 2018. At the same time, 5G is coming, what future will it create? Qualcomm believes that 5G will bring new opportunities for connectivity, which will be reflected in fine agriculture, real-time transportation, intelligent logistics, driver-less car, immersive shopping, collaborative workspace, flexible manufacturing, drone-driven transportation, immersive entertainment and more sustainable society.