China’s economic prospects are less promising than Japan’s or South Korea’s at similar stages, US think tank says
- Country needs tough reforms to boost economic growth and avoid ‘middle-income trap’, report says
- Amid trade war and teetering economy, China’s ‘economic miracle’ stalls
China’s much-vaunted economic miracle is less than meets the eye and its prospects less promising than those of neighbouring South Korea or Japan at similar stages of their development, a study by a Washington-based think tank concludes.
China in recent years has rattled the world with its hi-tech ambition, massive semiconductor investments and strategic focus on artificial intelligence. This dovetails with a nation focused education as parents pray to Confucius statues and students eat lucky carp dinners before the annual two-day gaokao, China’s college entrance exam.
“When economic growth was really rapid, after around 2005, you didn’t tend to notice all the things they failed to do,” Derek Scissors, an AEI senior fellow and the report’s author, said in an interview. “China can’t become rich with 550 million really poor people living in rural areas.”
Scissors tries to assess the likelihood that Beijing can escape that trap by comparing China with South Korea and Japan at similar points in their development, roughly four decades after their economies opened in 1979, 1962 and 1946, respectively.