Turning to China for recovery blueprint

The aftermath of any global crisis always results in change – particularly new production and consumption patterns. New ideas and sometimes even new products are often born out of crisis situations. One such example is synthetic rubber, a product that was a forced innovation due to limited supply during World War I. And during World War II, when the Japanese conquest of most of Asia temporarily halted limited supplies of natural rubber for the rest of the world, synthetic rubber went on to almost replace natural rubber.

Now again in 2020, scientists and companies are in a race to innovate a range of products that are needed to fight the COVID-19 battle, such as ventilators, testing kits and safety equipment. There are other patterns emerging as well. And these are consumption patterns. It will take several months before China returns to its pre-crisis position, but reports indicate that the Chinese, who were the leading consumers of luxury goods and were the biggest contributors to global tourism, have vowed off both indulgences.

Chinese people are now spending more on organic food and health supplements, while tobacco consumption has come down. A recent survey by BCG states that approximately half of Chinese consumers say they plan to spend more on preventative healthcare, vitamins and supplements, and organic foods over the next six months. More than one-third say they plan to decrease spending on restaurants, vacations and tobacco products over the same time frame.

In India, we have crossed the halfway mark into lockdown, and it is safe to say that Indians too will be making investments in products to improve health, well-being and hygiene, even insurance. Similarly, remote working will result in a clear shift in home infrastructure and work-from-home technology. New needs emerging from the current crisis will be the key driver for long-term innovations and will attract serious investments in areas like disease testing devices, public health training, tools and platforms for digital collaboration as well as remote office setups.

We should not imagine that these patterns will be permanent, but it may not be too premature for businesses and employers to make their annual projections factoring in a few of these observations, in order to create a recovery blueprint for the future.