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“The New Season of Chinese Economic Miracle” and its Challenges

Author

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  • SARMIZA PENCEA

    (Institute for World Economy Global Problems Department, Romanian Academy, ROMANIA)

Abstract

The investment and export-driven economic model followed by Chinese governments after 1978 served very well their catching-up vision, but China’s unprecedented race to the top had its flaws and drawbacks, leading to negative externalities and multiple structural imbalances. The global economic crisis and the interventionist package implemented to countervail its impact triggered a host of unwanted, negative outcomes which further aggravated the imbalances of the Chinese economy and created some new ones. It therefore became more obvious than ever that the old economic model had reached its limits and it needed to be changed. This task rests with the new cabinet led by premier Li Keqiang who launched a blueprint of bold reforms, but their implementation will presumably meet the strong opposition of powerful vested interests. The paper looks at the structural imbalances of the Chinese economy, highlighting the needed rebalancing processes. It also looks at the reform blueprint designed by the new leadership, disclosing and discussing some of its main implementation challenges.

Suggested Citation

  • Sarmiza Pencea, 2014. "“The New Season of Chinese Economic Miracle” and its Challenges," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 2(1), pages 56-64, May.
    • Handle: RePEc:ntu:ntugeo:vol2-iss1-14-056
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    References listed on IDEAS

    as
    1. Ettore Dorrucci & Gabor Pula & Daniel Santabárbara, 2013. "China’s economic growth and rebalancing," Occasional Papers 1301, Banco de España.
    2. Ettore Dorrucci & Gabor Pula & Daniel Santabárbara, 2013. "China’s economic growth and rebalancing," Occasional Papers 1301, Banco de España;Occasional Papers Homepage.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Sarmiza Pencea & Ana-Cristina Bâlgăr, 2016. "China’s Transition to the Innovation-Driven Economy: Stepping Stones and Road-Blocks," Global Economic Observer, "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences;Institute for World Economy of the Romanian Academy, vol. 4(1), pages 31-46, May.
    2. Sarmiza Pencea & Cristina Balgar & Daniel Bulin, 2015. "Building blocks of China’s path to technological prowess and innovation-led development," National Strategies Observer (NOS), Institute for World Economy, Romanian Academy, vol. 2.

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    More about this item

    Keywords

    China; development model; structural imbalances; economic rebalancing; economic reforms;
    All these keywords.

    JEL classification:

    • O21 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • P21 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Planning, Coordination, and Reform
    • P27 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Performance and Prospects
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid
    • P35 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Public Finance

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