China's economy: China’s best of times is also its worst of times
China’s hugely successful growth-at-all-costs economic strategy is reaching crisis point. The increase in domestic consumption that would help sustain high growth, is laggardly and its political leaders fight shy of pursuing the radical policies that would boost it. Elliot Wilson reports.
IN RECENT DECADES many ambitious emerging nations have risen, stalled and (sometimes) risen again. They have each adhered to the same superpowered investment-based industrial growth model – to their detriment.
The latest to suffer this fate is China, a proud nation undergoing its third cultural-industrial revolution in a century. In many ways, China has become a tale of two countries: the rich coastal western regions and the poorer hinterland; a wealthy urbane middle class and an enfeebled rural working poor; a corrupt corporate core driven by lazy, bloated state enterprises and a thriving but overlooked private sector.
China is in trouble. It faces slowing growth, a shortage of willing labourers, historically low rates of domestic consumption, and an economic model based on shovelling ever larger slabs of exports into countries and regions – notably Europe and the US – whose people, concerned about their future, are suddenly disinclined to spend.
"China is at high tide. Soon it will all be downhill and the fall will be quick"
China’s future, in short, reads like a horror story.