Powerlinx Blog

Expanding Into an Uncertain Market

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The slowing down of China’s economy has sparked vigorous debate, with many experts predicting hard times ahead for the world’s second-biggest economy.

Nevertheless, China still managed to achieve 6.9 percent GDP growth in 2015 – the slowest in 25 years, but still well ahead of other developed economies. And then there’s the recent announcement by Starbucks CEO Howard Schultz that his company will be opening thousands of stores across China over the next five years. Furthermore, a BT poll of 1150 businesses around the globe found that China remains the third-most-desirable market for international expansion, after the US and UK.

However, the general consensus is that China is undergoing a major economic transition, driven largely by weakening demand for its manufactured goods and a record-high debt-to-GDP ratio. So what does this mean for US-based enterprises looking to expand into this vast but volatile market?