The four “M”s: why the 21st Century belongs to Asia

By - Mark
18.03.21 11:36 AM

Schroders Head of Investments Asia, Viswanathan Parameswar, on the four “M”s and why the 21st century belongs to Asia.

Asia is on course to dominate the 21st century, bringing a wealth of investment opportunity.

Events in the world’s two most populous nations – China and India - capture the dynamic of why we believe Asia will shape the 21st century, and command the attention of the long-term global investor. Unprecedented energies are being unleashed through an alignment of digital innovation - and the four “M”s that characterise Asian consumers: millennial, middle-class, metropolitan and mobile-enabled.

How the four “M”s underpin a bright Asian future

There is no denying the social and demographic trends that give momentum to Asia’s rise to global economic leadership. Today’s Asian consumer is driving a transformation in the continent’s economic growth model that will play out for decades. From being the West’s manufacturing workshop, Asia has reinvented itself as an innovation leader serving increasingly demanding and sophisticated home markets, now defined by the four “M”s.


The four Ms represent a convergence of positive factors that will shape the Asian century. There are 800 million of them in Asia, compared with 66 million in the US (and 60 million in the EU). They are fast becoming the world’s most avid consumers, driven by optimism and ambition. 65% of millennials in emerging markets expect to be better off than their parents, versus an equivalent percentage in developed countries who expect to be worse off.

Middle class

Hundreds of millions of people across Asia have newly joined middle income status, representing a vast pool of purchasing power. From an investment perspective, one key Chinese consumer trend has been a preference for local brands. A McKinsey survey found Chinese now prefer domestic brands for 15 of 17 selected categories, including electric appliances and personal products.

According to the Brookings Institute, Asia will account for nearly nine in 10 of the next billion middle-class consumers. Most will live in China, India and Southeast Asia, and, by 2025, consumer spending by the Asia-Pacific region's middle-classes is forecast to surpass the rest of the world combined. 

That means industries and sectors oriented toward consumption have great potential to grow. Consumption trends combine with rising health consciousness to make consumer technology and healthcare two of the most significant Asian investment opportunities today. 


Asia’s growth is enabled by growing urbanisation, as workers pursue their dreams in cities. Today Asia has more than 300 cities with a population greater than one million; the US has 10 and the EU has 18. Asia’s high-density populations provide ideal conditions for companies to grow. It fosters a virtuous cycle of scale, leading to faster, cheaper, more innovative products and services. A powerful example is Chinese ride-hailing app Didi Chuxing, which has 30 million active drivers who are, today, 10 times more numerous than Uber’s. 


Asia has over 4 billion mobile phone subscriptions and more than 2 billion internet users, more than any other region, providing massive scalability for consumer technology.

Alibaba and other tech groups such as We Chat and Tencent are carving out innovative paths to tapping this consumer energy with super-apps that combine services such as e-commerce, ride-hailing, social messaging and even insurance.

Will there be an impact on growth and innovation in the post-Covid age?

The Covid-19 crisis is not dimming down Asia’s bright outlook. Rather, it reinforces prevailing trends.

Asia has used disruptions caused by the pandemic to accelerate the development of digital innovations critical to the post-pandemic era. These include remote communications, digital healthcare, mobile payments, e-commerce, and next-generation mobility.

Immense challenges lie ahead, not least ever-present regional tensions as these increasingly assertive countries take centre stage. However, with increased presence comes an increased focus and recognition of the importance of diplomacy in forums such as the UN and WEF. And the dynamism, aspiration and innovation vigour of the four “M”s promise to make Asia’s century one of almost limitless possibility.

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Viswanathan Parameswar, Head of Schroders Investments Asia
By Viswanathan Parameswar, Head of Schroders Investments Asia

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