How COVID-19 Changes China

We have consistently been attracted to three investment themes in China—healthcare, consumer, and technology—and believe COVID-19 enhances the opportunities they present.

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We have consistently been attracted to three investment themes in China: consumer, healthcare, and technology. All three themes are further enhanced by COVID-19 developments.

Consumer. As China continues to shift to a domestic consumption-driven economy, we believe emerging middle-class consumption will remain the strongest driver of domestic economic growth and bottom-up investment opportunities.

Healthcare. Healthcare has also become a bigger focus of the general public in China in light of the COVID-19 pandemic, and China is vastly underpenetrated and underspending in terms of healthcare compared to many countries in the world. We believe this shift will help put China on the map for healthcare investment going forward.

Technology. Last but not least is technological development. As an example, China has recently accelerated investment in semiconductors, increasing support to domestic companies that offer technologies along the semiconductor value chain.

We believe the overall crossover between these three areas will continue to drive quality growth investment opportunities in China. Therefore, we remain very positive about China and believe that the pandemic further enhanced our opportunities there.

Vivian Lin Thurston, CFA, partner, is a portfolio manager and research analyst on William Blair’s Global Equity team.

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