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World / Opinion

UK marketing chief Sorrell confident on Chinese growth

By Cecily Liu (chinadaily.com.cn) Updated: 2015-10-22 21:59

The Chinese economy will continue to be an important driver of global economic growth, despite slowing domestic growth rates and a recent stock market crisis, Martin Sorrell, chief executive of WPP, the world's largest marketing services group, told China Daily.

Sorrell said he feels confident the Chinese economy will continue to grow at an adequate rate, as the stock market turmoil is not reflective of its fundamental growth potential.

Sorrell was speaking in an exclusive interview on Wednesday, during Chinese President Xi Jinping's UK state visit.

He said that the UK government is doing well on improving cooperation with China on trade and investment, but there was still great room for further growth. He said that when Chinese and British leaders speak of a golden decade, "I think they are right. There's still a long time to go. British trade with China in my view is in its infancy."

China is WPP's third biggest market, where it employs 16,000 people, and the company is thought to have made about 1 billion pounds in revenues from Greater China last year.

"China is an extremely important market in absolute size and if you look ahead for the next 20 to 25 years it will become the largest in the world. China's population is the largest in the world, and if you look at the market potential it's very considerable," Sorrell said.

Speaking about the recent sharp fall in Chinese stock prices and the renminbi depreciation in August, Sorrell said that it will have no impact on consumption. "The Chinese stock market was overvalued, but it will not affect domestic consumption. The decline of the renminbi came to some as a surprise, but it's a more realistic adjustment."

He compared the Chinese economy's rise to that of the US, which was unparalleled in history. He noted that the US stock market crash of 1929 and subsequent recovery of the US economy showed that such downturns were merely cyclical.

"No economy of (China's) size has gone through a revolution of this nature in such a short period of time. It took the US hundreds of years to become a leading economy," he said. "What you're seeing now is a cyclical adjustment and an adjustment with the new regime to accommodate higher quality growth, and deal with issues like the environment and sustainability at the same time."

Sorrell said that as China develops a more service-oriented economy, its advertising market will grow, hence the importance of China for WPP. "The growth in China has slowed, but there is increasing growth in advertising and marketing."

He added that China's growth will also play a key role in triggering further growth in other countries. "Even a six or seven percent growth in China will still have dramatic impact on the growth prospects of the world economy."

"I sometimes get the feeling that some people in the West would like to see China fail. That's the wrong attitude. We'd all like to see China succeed," he said. "China is an opportunity and not a problem."

To contact the reporter: cecily.liu@mail.chinadailyuk.com

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