China’s growth rebound may be capped by a labor-force squeeze and shrinking resources that leave the government satisfied with rates of expansion as low as half the peak during the past decade.
A pace of 7 percent to 8 percent reflects economic forces, Ma Jiantang, head of the National Bureau of Statistics, said on Jan. 18 after reporting 7.9 percent expansion in the fourth quarter from a year earlier. He said a decline last year in the working-age population was of “great importance.”
Ma’s comments bolster the contention that China’s economy is permanently downshifting a gear as its one-child policy drives down the labor force. Slower growth presents challenges for incoming leaders Xi Jinping and Li Keqiang, and may limit the country’s potential as a market for everything from Australianiron ore to German machinery.
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