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Tickers in this Article: YUM, K, KO, MAT, COH
Earlier this month, the world watched China celebrate its 60th anniversary as a nation stronger and more industrialized than ever. Growing into a global power, the country is being looked upon to help propel the world economy out of a recession. And while my firsthand observations from Shanghai have led me to question just how fast and far China can grow as a whole, one thing is for sure: Chinese consumers will provide global companies with short-term relief.

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U.S. retail sales showed signs of stabilization in September. However, consumption levels will not revert to pre-recession levels anytime soon. With unemployment levels lingering at such high rates and consumers continuing to de-leverage, consumer-oriented companies must find other ways to generate growth and help offset dramatic declines domestically.

China Is The Answer
The one child policy is causing parents to spoil their kids; many of my Chinese co-workers still receive allowances from their parents and live at home to save money. Using their extra disposable income from these sources, the young Chinese are shopping at unprecedented rates.

According to a Credit Suisse economist in Hong Kong, China will overtake the U.S. as the largest consumer market by 2020. And in the second quarter, China's retail sales grew 15% while e-commerce sales rose an astonishing 91.9%. (Learn more about retail sales and other reports in our Economic Indicators Tutorial.)

The numbers aren't needed though; a stroll down the Times Square and Jiang'an shopping districts here in Shanghai will easily make you a believer. I've had my fair share of difficulty pushing and shoving my way through the crowds in Shanghai's luxury shopping malls on Saturday afternoons and have even waited 30 minutes for a changing room.

Lovin' the USA
China's government may not always be fond of the U.S., but the Chinese in general are infatuated with America. The general perception of foreign branded products among the Chinese is that anything American made is trendy, high quality and gives off a sense of prestige.

Ask a local Chinese what their favorite restaurant is and you're more than likely to hear KFC. The YUM! Brands (NYSE: YUM) chain is known as a greasy, cheap and quick place to eat on the run in the states. Here, KFC is a way for the local to eat westernized - even though the menu doesn't even begin to resemble an American one - at a reasonable price. The restaurant has emerged into a favorite destination for all meals of the day and is far from being perceived as a cheap fast-food joint. In fact, even competition for jobs at most locations is fierce.

Mattel's (NYSE: MAT) Barbie is a classic figurine among little girls in America. In China, it's an American symbol for young females of all ages. In fact, here in Shanghai, there is even a Barbie lounge where cocktails are served for age appropriate adults.

Based on current currency conversion rates, a box of Kellogg's (NYSE: K) Special K costs nearly three times what it does in the states, but like most western brands, shoppers happily pay the premium. Coach's (NYSE: COH) double-digit growth in China can be witnessed on my daily commute each morning as the high-end bags are perched on arms throughout the metro. And Coca-Cola (NYSE: KO) opened a new $90 million Global Innovation Technology Center here in Shanghai, further highlighting the importance of the investment companies are making in China. The list goes on and on.

The Best Part Of All
Of course, American brands are still unreachable for an enormous number of Chinese. But that's the beauty of China's consumer market. The vast potential that the western consumer sector can tap in this country is exciting. According to the national census bureau, China has 200 million potential consumers aged 15 to 24. That age group alone represents two-thirds of the U.S.'s total population.

Even more promising is how China fuels its spending habits. The Chinese boast high savings rates and using credit cards as a means to purchase items that cost more than the cash they have stored in the bank is a very new concept. Thus, China's consumption growth story is real. (Read more about China's market in Investing In China.)

A Savior to U.S. Retail
China may not be the total answer to the world's economic problems but the country's spending power is enormous and will undoubtedly offer temporary relief to U.S. companies that properly penetrate the market.

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