The Choices Facing China

4th May, 2006

As befits a nation that works to five-year plans and is not affected by electoral cycles, China likes to take a medium to long term view of its development, setting clear goals and organising smooth leadership changes between generations.

But, for all the planning, the outlook for the world’s fastest-growing big economy contains more than its fair share of inconsistency and incoherence as President Hu Jintao and his colleagues get to grips with a thicket of inter-linked political and economic issues, which are more important to them than their country’s growing global presence.

The government and Communist Party have set firm domestic economic goals to reach by the end of the first decade of the 20th century. These include bringing the growth rate down from the current 10 per cent to 7.5 per cent, boosting domestic consumption, reducing the savings rate, strengthening the banking and financial systems and ironing out ...

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