Arresting China's Slowdown

The Search for Sustainable GrowthSource: Getty

Yukon Huang

Op-Ed June 3, 2014

Financial Times

Summary

Expanding the role of the private sector and encouraging efficient urbanization has the potential to sustain Chinese GDP growth of at least 7 percent for the remainder of the decade.Related Topics

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中文PrintAdd a comment There are no signs that China’s slowdown has bottomed out. A turnround would require some combination of a pickup in investment, exports or consumption in the midst of current efforts to deleverage and this is unlikely to happen soon. More than a decade ago during the Asian financial crisis, China was able to revive growth despite a similarly severe debt problem by tapping buoyant global markets facilitated by its accession to the World Trade Organisation.

But circumstances this time are different. The recovery in the US and Europe continues to be tepid with both parties needing to generate stronger trade balances to support their recoveries. Thus any bounce in exports is likely to be modest and China will face continuing pressures to scale back its trade surpluses with negative consequences for industrial production.

Yukon Huang

Senior Associate

Asia Program

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