"The tailwinds of growth are so strong. You've still got a lot of growth that can come in a fairly straightforward manner through completing infrastructure and heavy industry and urbanisation," said Arthur Kroeber, managing director at GaveKal Dragonomics, a consultancy in Beijing.
"As long as you have a model where simply accumulating capital is your main source of growth and the efficiency
Once efficiency becomes imperative, however, China will struggle to convince vested interests, notably big state-owned companies that have benefited disproportionately from subsidies and stunted competition, of the need for reform.
y with which that capital is used is not important, then all of these processes can continue unimpeded and they don't really obstruct growth," he said.
"I would say that's a very, very serious risk because you don't have the kinds of institutions like a free press or regulatory agencies or NGOs that act as a check on these kinds of concentrations of financial power," Kroeber said.
"But that's more on a decade horizon than on a five-year horizon."
More in the Reuters' article.
Arthur Kroeber is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch.
- No room for high-risk innovation - Arthur Kroeber (chinaherald.net)
- Inflation undermines consumer confidence - Arthur Kroeber (chinaspeakersbureau.info)
- Is China's economic boom over? (business.financialpost.com)
- Urbanization needs building spree - Andrew Leung (chinaherald.net)
- Calculating the Coming Slowdown in China (nytimes.com)