Investment opportunities still abound in China

Industries such as healthcare, the Internet and energy have a bright future

China's economy, which is in the process of transformation and adjustment, is experiencing turbulence.

Authorities have called this period the new normal, meaning that the speed of economic growth had to slow down to some degree as a result of essential reforms that include adjustments to the big forces that drive the economy.

The slowdown has hurt some industries and companies more than others. Over the past year, Anbound Consulting research teams traveling around the country found some local economies hurting from the real estate industry slide, falling income, increasing debt, difficulty for traditional industries and a worsening financing and investment situation.

Some economists are in pessimistic, many voices calling for economic stimulus, and policymakers are also under increasing pressure.

But it is good to keep in mind that a great deal of pessimism does not look warranted based on China's huge domestic market. The economy has continued to grow at 7 percent. (The figure was 7.4 percent during the first three quarters.) The growth rate for investment is above 16 percent, and the figure for consumption is 12 percent, while it is 5.1 percent for exports. Though economic development is still sluggish, GDP during the first three quarters was 42 trillion yuan ($6.8 trillion, 5.8 trillion euros). Such a big economy should provide bright spots and some room to grow.

Indeed, some sectors look especially promising for investment, such as the ones listed below:

First is the energy sector, a key industry for national economy. There is always a strong demand in this field, including for the utilization and innovation for new energy, innovation with traditional energy sources, and the development of energy-saving industries and technologies. The new energy industry, which had declined several years ago, has returned with an increase in domestic demand.

Second is the equipment industry, the foundation for modern industry, which also reflects the strategic capability of the nation. The fact that China's high-speed equipment can access the international market is largely the result of the equipment industry. A document issued by the National Development and Reform Commission and the Ministry of Industry and Information Technology shows China's support for development of energy-saving equipment and product manufacturing.

By 2017, the output of the highly efficient energy-saving technology and equipment industry is projected to exceed 750 billion yuan. It is certain that the high-tech equipment industry will be supported by national policies in the long term. It is also likely that large-scale, state-owned enterprises as well as private companies in this field will be supported by the national government.

Third is the environment protection sector. China has put more and more emphasis on environmental protection, which has become essential to increase quality of life for the Chinese people. The characteristics of the industry indicate that this field does not easily give rise to large-scale companies, but will give birth to many vigorous small-scale companies.

Fourth is the logistics industry. Any industry involved in supplying commodities has ties to the logistics industry. This industry is one of the strongest of the Internet era and is essential to Internet economies' sound functioning. Core competencies for logistics businesses include building network and managing information. This sector is welcoming to large-scale companies.

Fifth is the Internet industry, a popular area that attracts capital investment worldwide. In China, the Internet industry has its own characteristics that differentiate it from the industry in other parts of the world. For instance, China's huge domestic market is closely connected with Internet applications and innovation, which gives birth to large-scale Internet companies and Internet economies - with Alibaba, Tencent and Baidu as the most vivid examples. While the field can be costly to enter, more capital is expected to help finance its huge potential.

Sixth is the medical care and health industry. With the increase of per capital income, boosting the development of medical care and the health industry is also essential for the Chinese people. Besides entities that directly treat diseases, the health and nutrition industries are also expected to experience huge development. China's aging society also will stimulate the needs of the healthcare and nursing industries.

Seventh is the education industry. Education also is considered an essential demand of the Chinese people with the increase of China's per capita income. Some related educational industries such as the training industry are expected to blossom. The connections between education and the Internet are likely to grow.

Investors are looking for opportunities. Even things like the sluggish economy, the adjustment of the industry mix, and restructuring of companies' assets represent potential market opportunities. Seizing the opportunities presented by industries with growth potential is essential for both local governments and investors.

The author is a senior researcher with Anbound Consulting, a think tank for public policy. The views do not necessarily reflect those of China Daily.