Where is China’s economy heading? After many years of apparently inexorable
rapid growth and economic development, it is rare for such a question to be
greeted with so many possible answers. Uncertainty about China’s economic
trajectory abounds. Slowing growth, rising debt, and a deterioration in
corporate performance all suggest that the investment-led model that has
served the economy so well thus far is no longer fit for purpose, and that a new
approach is now needed.
In this report, we put the case for China to transition to an economic growth
model centered on productivity that can help this economy rediscover its
dynamism and finally complete its journey toward being one of the world’s
advanced economies. By focusing vigorously on productivity, China would
not only reap considerable benefits in terms of additional growth and
rising incomes, but would also be able to tackle its current debt challenge.
Specifically, we look at five opportunities that could deliver an additional
$5.6 trillion (36 trillion renminbi) of GDP growth and $5.1 trillion (33 trillion
renminbi) additional household income in 2030