‘The next China is still China’: McKinsey’s Joe Ngai and Nick Leung on why global business can’t write off the Chinese economy

When Joe Ngai, McKinsey’s Greater China chair, first began to test-drive his point that “the next China is still China” on social media, the world’s second-largest economy was in a post-COVID slump. Sluggish consumption and a property market crash were still dragging down the country’s economy, while foreign companies were rethinking their investment in China as both a consumer market and a manufacturing hub—and asking where the “next China” might be.

“You heard all these things. We’re trying to diversify away from China. We’re trying to de-risk from China,” Ngai tells Fortune in McKinsey’s Hong Kong office. “You can’t find another China. There’s no other China out there now.”

Ngai’s observation is now a book, The Next China is Still China: An Insider’s Playbook for Winning in the New Era, coauthored with Nick Leung, director of the McKinsey Global Institute and Ngai’s predecessor as Greater China chair.

The narrative on China’s economy is shifting. New advances in AI have reset the conversation about China’s capacity to innovate, and Chinese products are now winning converts in overseas markets. The U.S.-China relationship is no longer in free fall following U.S. President Donald Trump’s state visit to Beijing in May, the first by a U.S. leader since Trump’s last trip in 2017.

But for global multinationals, Ngai and Leung argue that China remains a...