The internet in China could enable 4 to 14 trillion yuan ($640 billion to $2.26 trillion) in annual GDP growth by 2025, according to McKinsey Global Institute (MGI).
MGI said in a report that this means some $1.6 trillion in annual GDP, the size of Australia’s GDP, will be at stake by 2025, depending on the speed and extent of adoption.
New internet applications could add 0.3 to 1 percentage points to China’s GDP growth rate and enable 7% to 22% of GDP growth through 2025.
Along with creating economic value, the internet is expected raise the bar for China’s labor force, shifting employment opportunities to a new set of markets even as traditional sectors see automation replacing labor.
The report finds that the internet will continue to have a substantial impact on the consumer electronics sector, contributing some 14% to 38% of the overall growth expected through 2025.
New internet technologies could also fuel some 10% to 29% of the total GDP growth expected in the automotive sector by 2025, with 60% of this impact stemming from productivity gains.
In the chemical sector, companies can use the Internet of Things to begin offering integrated product solutions such as water treatment for industrial clients or precision farming systems. The internet could contribute anywhere from 3% to 21% of the total GDP growth expected in the chemicals industry through 2025.