"The regional market for goods and services will increasingly provide opportunities for expansion," said lead economist and principal author of the Update, Ivailo Izvorski.

I have discussed two of the principal factors that may constrain the pace of the recovery, namely, restrictive bank lending and the weak job market.

However, Stephan Binder, a Shanghai-based McKinsey principal, believes the crowded Chinese market will see a growing polarisation between 10-15 leading firms and a dwindling number of smaller rivals.