Investors can access greater growth opportunities in China than by simply investing in Australia's big resource companies, according to Premium Funds Management chief investment strategist Simon Wu.
"The sheer size of China's population is providing the greatest opportunity of a lifetime," Wu said at a Sydney adviser briefing.
Crucial to this size is China's growing consumer population, Wu said.
China is now moving from an export-driven economy to a consumer-driven economy with the average savings rate falling from 40 per cent to 35 per cent.
Wu says the reduction in savings is consistent with the Chinese government's plan to boost domestic consumption by addressing the population's insecurity over their future.
"The Chinese government has introduced free education, free healthcare and pensions. The population now feels more confident to reduce their savings and increase their spending," Wu said.
"The government policy is very much pro-consumption."
Wu said companies in the consumer staples, consumer discretionary and information technology sectors were best positioned to grow from China's increasing appetite for goods.
He said a number of consumer luxury companies like iconic French leather goods maker Hermes are now moving to list on the Hong Kong Stock Exchange.
He said investors have access to greater returns from China-based companies than from companies based in developed countries who derive a large portion of their sales from China.
Last year, BMW achieved 12 per cent sales growth from China. However, during the same period, Brilliance China, BMW's joint-venture partner there, achieved a 152 per cent increase in sales, according to Wu.
Wu said inflationary and growth concerns do remain for China.
However, he believed that China will be able to address its inflationary problems and said inflationary pressures were simply a product of a developing economy.
Wu said China's growth rate will probably be around 7 per cent which is "not a hard landing".
"Ten years ago, Shanghai was one big rice paddock. Today it is filled with big buildings. This growth is still happening. China still has scope to grow."
