ING Investment Management examines the structural challenges accompanying China’s remarkable economic rise, arguing that sustaining 7.5% GDP growth requires rebalancing away from investment toward consumption. It explores demographic aging, environmental pressures, shadow banking, and debt risks that could reshape China’s long term economic trajectory.
The Challenges of China’s Rise, Part 1
ING
Tanweer Akram
Research
64 Pages
Key Takeaways
Growth Rebalancing Needed: Consumption has grown strongly, yet its share of national income has declined while investment remains unusually high, making the current growth model increasingly difficult to sustain.
Demographic Headwinds: The dependency ratio is projected to rise from 13.5% in 2010 to about 30.0% in 2020, increasing labor costs and reducing the supply of inexpensive workers.
Shadow Banking Risks: Shadow banking reached about $3.2 trillion, or roughly 40% of GDP by early 2013, raising concerns about financial stability and property market excesses.
Join our newsletter to have all of this content + Exclusive Newsletter Bonus Content delivered to your inbox every week
