Australia's largest standalone winemaker Treasury Wine Estates reported underlying net profit after tax of A$470.6 million ($307.2 million) and 16 percent growth in its annual underlying profit for the financial year 2025 - ended on June 30 - partly driven by robust demand for its flagship Penfolds business in China, Reuters reported on Wednesday.

These results strongly underscore that, even against a backdrop of global economic uncertainty, the profound potential and resilience of the Chinese market remain vital factors for companies from Australia and other countries seeking both stability and breakthrough growth. China's consumer base is vast, but equally important is its evolving structure.

For firms such as Treasury Wine Estates, China is not simply a large export destination; it is a market undergoing significant consumption upgrading, where an expanding middle-income population is fueling sustained demand for higher-value products. Foreign firms able to calibrate their product mix to the dynamic trends in China's market can capture market share across multiple price points.

According to the National Bureau of Statistics, per capita consumption expenditure rose 5.3 percent year-on-year in 2024, with rural household spending growth even stronger at 6.1 percent. Notably, spending on education, culture, and recreation jumped 9.8 percent, while transportation and telecommunication spending grew 8.9 percent - signals of rising demand for higher-value lifestyle services.

This trajectory aligns with global insights. McKinsey's mid-2025 report showed that retail sales rose 5 percent year-on-year in the first half of the year, with food up 12.3 percent, auto sales rising 11.2 percent, and electric vehicles surging 37.2 percent. The 618 Shopping Festival delivered a 15.2 percent gross merchandise value boost, with appliances, sports, and health products all posting double-digit growth.

On the policy front, China is ramping up support to catalyze consumption in various sectors. For example, in June, six Chinese departments, including the People's Bank of China, the central bank, issued the "Guidelines on Financial Support to Boost and Expand Consumption," vowing to accelerate the implementation of related policies, strengthen monitoring and tracking, and guide financial institutions to continuously increase their support for the consumption sector.

All these shifts are embedded in China's "dual-circulation" development pattern, which takes the domestic market as the mainstay while allowing the domestic and international markets to reinforce each other. While enhancing the consumption upgrade, China is also proactively hosting a series of key events such as the China International Import Expo (CIIE) to enhance imports and share the benefits of its economic growth with businesses committed to the Chinese market.

The 7th CIIE, held in November 2024 in Shanghai, exemplified this strategy. The event attracted nearly 3,500 exhibitors from 152 countries and regions, including 297 Fortune 500 companies and industry leaders, highlighting the rising appeal of the Chinese market.

China's consumption upgrade is real and accelerating - not just in numbers, but in nature. Urban and rural households alike are trading up toward lifestyle-oriented, experience-based, and higher-quality goods. For global exporters and businesses, these structural trends present opportunities well beyond short-term demand bursts - pointing instead to sustained, value-driven growth in China's massive consumer market.

China's expanding high-level opening-up and improved business environment are increasingly enabling foreign firms to achieve long-term, stable growth. The 2025 negative list for foreign investment was further shortened from 117 to 106 items, opening up key sectors such as pharmaceuticals and logistics.

On the trade relationship level, Treasury Wine Estates' strong performance in China is further evidence that a healthy and stable China-Australia economic and trade relationship serves the fundamental interests of both nations.

Additionally, a survey by the China Council for the Promotion of International Trade in January showed that nearly 90 percent of businesses reported satisfaction with China's business climate, and more than 60 percent remain optimistic about future prospects. These improvements reflect China's commitment to high-level opening-up, fair competition, and sustained economic vitality.

China provides vast opportunities for Australian products, while Australian goods and services meet China's diverse market needs. Grounded in market principles and complementary strengths, this cooperation remains a vital driver of sustained prosperity for both economies.

By Wang Yi