After four disappointing years, Chinese economists have realized that slowing GDP growth — from a post-crisis peak of 12.8 percent in 2010 to about 7 percent today — is mainly structural, rather than cyclical. In other words, China’s potential growth rate has settled onto a significantly lower plateau. While the country should be able to avoid a hard landing, it can expect annual growth to remain at 6-7 percent over the next decade. But this may not necessarily be bad news.
Read Full Article »
