The Development of ChineseCounty Territory Economy----The research of the main mode and problems ofcurrent Chinese county territory economic development

Kevin Tan from Wisdom ConsultingCurrent China's Macroeconomic Situation

The main mode of current
county territory economic
development

Those problems ofcounty economy
development mode need
to be resolved

Current China's Macroeconomic Situation

Although under the pull effect of the powerful Internet + and asset

securitization innovative policy, China's macroeconomic situation is still
continuous low.

Background
The root cause is that, we still can not find those rational solution for these serious
redundant construction and excess capacity problems which caused by the previously

extensive and energy intensive development pattern of China.
This year, general secretary of China Xi jinping had emphasized the guidance ideologyof the supply side reform: De-capacity and structural optimization, in order to promote
the change and upgrade of China's economic model step by step.

China'sMacroeconomic

The M1 money supply and growthrate is much greater than the M2,
the inflation pressure is obvious

Data sources： China's National Bureau of Statistic

Since 2010, China's GDP growth continued downward, annual GDP growth was 6.9% in 2015. It was the first timethat China’s GDP growth fell into the "age of 6“ since 1978, and the GDP growth of 2016 first half year was 6.7%.

The Main Mode of Current County Territory Economic Development

Land finance is unsustainable, so those counties which are lack of fiscal

revenues must find new pulling force and income resource.

Real Estate
Industry

Had lost the pulling power

Data sources： China's national bureau of statistic

2016 China listed real estate companies evaluation research indicate that the real estate development
investment growth of 2015 had fallen to the lowest level in past 17 years, the market segmentation
situation would be further intensified.

RuralE-commercialization

Pulling regional economy andincreasing tax revenues

Relying on the vast overall internet infrastructure
construction and successful experience of electronicbusiness platform operation of China, more and morecounties take subsidiary agricultural products and low
value-added processing industrial products as new
integrative points. Those huge rural population andassets , capital stock would be the gold mine to attract
capital intensively to undergo the exploitation.

The traditional
overcapacity industry
segmentation vertical
E-commercialization

More and more vertical segment
electric business platform will arise

For some excess traditional industries withcross-regional advantages, the county
governments will support those leading
enterprise to conduct segmentation
vertical E-commercialization with effective
measures, in order to optimize industrial
structure and achieve the industrial
upgrading in the future.

Data sources： China's national bureau of statistic

Agricultural Tour
conomyTourism had become efficient growth
point to pull the national domestic
demandData sources： China's national bureau of statistic

Chinese rich natural resources makes many counties have a certain tourism development potential and characteristic

agricultural product configuration potential, and most domestic counties has pay more and more attention to relative
investment currently.

How to Accurately Segment and Position the Market Accurately is the Major
Problem of Those Counties to Face

How to get accurate market segmentation & positioning and avoid excessive

E-commercialization, repeated investment & vicious competition?

Problem 1

Be short of effective experience,resources and ability of electricbusiness platform investment,construction and operation.

It must bring great decision-making and investment risk due to the short of investment, construction, operation
experience when more county governments or enterprises in the face of the internet.

Problem 2

How to get accurate market
segmentation and positioning
should be the major problem of
those counties to face.

If we can not change the decision making mentality and position the customer base on the data accurately, it would be amajor problem of those counties and enterprises to find their own market segmentation.

Problem 3

A new round of excessive
electricity business risk

China's policy guidance, follow suit & speculative mentality, is bound to bring a new round crazy electric businessplatform investment , how to avoid a new round of excessive E-commercialization, repeated investment and vicious
competition, will be a risk which is hard to be avoid.

THANKS
Wisdom Consulting From China