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Growing access to the internet has spurred rapid growth of China’s e-commerce market, which is now the largest in the world. In 2020, China’s e-commerce market was valued at nearly $2.1 trillion, making it more than three times larger than the entire European e-commerce market.
Chinese tourism, both within China and abroad, has seen significant increases.
Debt patterns are similarly changing. Historically, Chinese households have had low levels of debt as a percentage of GDP as a result of their relatively high savings rates. Yet, from 2014 to 2019, China’s households added $4.6 trillion in borrowing, causing household debt to surge to 56 percent of GDP.
The increased consumption levels of the middle class have contributed to environmental stresses. Rising vehicle purchases, higher gasoline consumption, and urban sprawl are resulting in higher CO2 emissions and elevated levels of air pollution.
Inequality also poses a challenge for China, as the benefits of economic growth have not been shared equally throughout Chinese society. China’s Gini index – a measure of a country’s income inequality scored from 0 (perfect equality) to 100 (maximal inequality) – increased from 32.2 in 1990 to 43.7 in 2010.