China remains world's top retail market
China has been ranked as the top country in the 2016 Global Retail Development Index (GRDI), titled "Global Retail Expansion at a Crossroads." According to the report by global management consulting firm A.T. Kearney, India's high market potential, fast growth, improved regulatory environment, and ease of doing business pulled it up to second in the rankings.
The 2016 GRDI marks the 15th annual edition of the report. During the past 15 years, developing markets have seen tremendous growth both in terms of population, which has grown 21 per cent to 6.2 billion, and in terms of retail sales, which have increased 350 per cent in developing countries and now represent more than half of total global retail sales.
The GRDI ranks the top 30 developing countries for retail investment worldwide. The Index analyzes 25 macroeconomic and retail-specific variables to help retailers devise successful global strategies to identify emerging market investment opportunities. The study is unique in that it not only identifies the markets that are most attractive today, but also those that offer future potential.
Hana Ben-Shabat, A.T. Kearney partner and co-author of the study, commented, "Despite China's slowing economic growth, the GRDI's top-ranked country remains one of the most attractive global retail markets. The economy is gradually shifting from an investment-driven model to one driven by consumer consumption. The growing middle class coupled with strong demand from inland and lower-tier cities and the loosening of the one-child policy will continue to drive growth over the next 10 years."
Mike Moriarty, A.T. Kearney partner and co-author of the study, said, "India's high ranking is driven by GDP growth, improved ease of doing business, and better clarity regarding FDI regulations. India is now the world's fastest-growing major economy, overtaking China, and retail demand is being fueled by urbanization, an expanding middle class, and more women entering the workforce."
Overall, Asia is a regional winner in 2016, with four of the top five countries in the Index—China, India, Malaysia, and Indonesia due to a combination of large populations and high growth.
The official launch of the ASEAN Economic Community (AEC), which created a $2.6 trillion market with a population of more than 622 million, is an important milestone, although implementation will be a long process. The Trans-Pacific Partnership (TPP), if ratified, could boost GDP in several Asian countries, including Vietnam and Malaysia.
E-commerce continues to grow in Asia, rising 35.7 per cent in 2015 to reach $878 billion. Asia is now not only the largest e-commerce market, but it also holds a majority share of global online sales (52.5 per cent), the report said. (SH)
Fibre2Fashion News Desk – India