This year marked a significant shift in the mindset of China’s Communist Party. Oft-repeated promises to carve out a more sustainable development path finally translated into action as China’s new leadership abandoned breakneck growth pursued by its predecessors and moved to address the consequences of severe environmental degradation, unbalanced regional growth and social injustice.
The economy is predicted to have grown 7.5 per cent in 2013, the lowest rate of increase for more than a decade, and it promises to be much of the same in 2014. Many investors spoilt by double-digit Chinese growth that became commonplace even during one of the world’s most serious financial crises see the dip in growth as a weakness.
But rather than being a cause for alarm, it signals reasons for optimism. Tearaway growth threatened the country’s long-term stability and it simply could not continue forever. Besides, a 7.5 per cent growth rate is still by far the highest of the Brics economies of Brazil, Russia, India, China and South Africa. Growth in Brazil and Russia actually entered negative territory in the third quarter of this year, while growth in India and South Africa tapered far more speedily than in China, despite the revival in fortunes of the US, the UK and several other industrialised economies.