China: Gradually, now suddenly

MUCH of the current China focus is on the economic challenges brought by the pandemic. We expect China to record growth near 5 per cent this year as restrictions ease and stimulus gains traction. But its structural shifts have fundamental and far-reaching implications.

There are several instances of economies beset by apparent short-term shocks that ended up being lasting economic changes: Neither Australia after the 2000s boom nor Japan after its bubble burst in 1991 returned to previous rates of growth.

The pandemic could well be such a catalyst for China.