Unleashing Chinese Consumer

Sell side is running hot with Chinese consumer investment theme. McKinsey wrote in the report recently:

There is recognition at the highest political level in China that the economic paradigm that has served the People’s Republic so well thus far is no longer fit-for purpose. China’s investment-led model has skewed the economy toward industry and has made corporate investment too cheap, leading to inefficient investment in excess capacity. Reliance on exports has left China exposed to a downturn in its major markets. As the global fallout of the US financial crisis has put new strain on China’s current development model, the case for shifting toward a stronger reliance on domestic consumer spending has gathered force.

While searching for the reference to my sadly curios Dr. Copper story, I came to a quite old story written by Stephen Roach back in March 2006:

The Chinese leadership is going out of its way to inform its own citizens, as well as those in the broader global economy, that it will now push for just such a rebalancing. That was certainly the major thrust of the recently approved 11th Five-Year Plan...
..............
The second leg of the stool is the government’s pronouncement on the intent to rebalance the mix of GDP growth over the next five years. Ma Kai, Chairman of the National Development and Reform Commission, did the heavy lifting on this point — stressing the need to boost both the consumption and the services shares of Chinese GDP at the cost of lowering the portions going to exports and fixed investment.
.............
The Chinese consumer will not spring to life over night. But this is likely to be a major story over the next 3-5 years.

More than 3 years are gone ... and the debate is heating up - what springs to life?