Booming e-commerce businesses are the latest structural shift behind China’s rural take-off.
The China Confidential Rural Wealth Index (CCRWI), which measures key aspects of rural economic activity to ascertain the pace of wealth creation, rebounded to 56.3 in February from 51.0 in January boosted by an increase in rural vehicle sales and rebounding tractor sales.
China's central bank has cut the required reserve ratio (RRR) for certain branches of the Agricultural Bank of China (1288:HK), one of the country's top three lenders, in a measure designed to encourage lending in rural areas.
Big chains move to small towns as rural spending power grows.
A sharp decline in pork prices and tractor sales brings down the rural wealth indicator in January, but longer term outlook remains positive.
Strong land transfers, rising pig prices and plentiful credit to rural enterprises creates a robust picture, which looks set to continue.
Inflation figures released today extend Beijing's license to ease liquidity policy further in coming weeks (CC Jan 12 Macro View) and further relieves manufacturers from the big margin squeeze that characterised 2011 (CC Jan 12 Consumer China).
The price of pigs may have slumped but Chuying Agro-Pastoral, relying on a pioneering ‘insourcing’ business model, remains bullish.
Betting on above 8% growth in 2012 is a bet on Beijing’s power.
Economic activity in the countryside picked up slightly in November helped by a rebound in pork prices.
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