A lot of room for China's economy to grow: Economist at WEF

CGTN Europe

China's economy still has untapped potential and will continue to contribute to global recovery, said Jin Keyu, associate professor of economics at the London School of Economics in #Davos. #ChinaEconomy

Transcript

00:00 You know, China is suffering from a severe deficit in demand

00:03 because of low wage growth,

00:05 scarring effects of the pandemic,

00:06 and of course, the real estate.

00:09 But I just want to say, because of China's size today,

00:12 growing at 3% to 4% even, it's not a bad thing.

00:16 If India grows 4 percentage points faster than China

00:19 from now until 2030,

00:20 China's still going to contribute $130 trillion

00:24 of additional GDP more than India will to the world.

00:27 You know, renewables or digitization, in the short term,

00:30 it can't possibly displace real estate

00:33 as a provider for growth and employment

00:35 in the way that it had in the last 10 years or so.

00:38 Second, services.

00:39 Right now, it only accounts for half of GDP

00:42 and only 48% of employment.

00:44 That number is 80% in advanced economies.

00:47 So you can imagine a whole amount of room

00:50 for also absorbing the youth

00:53 who are underemployed, highly educated.

00:55 They account for more educated skill force

00:58 than manufacturing.

00:59 And you also have almost a billion people

01:02 who haven't really reached middle income

01:04 by international standards, living under $300 per month.

01:08 So I can go on and on.

01:10 When even Japan and Korea leveled off their growth,

01:13 their productivity as a share of the US was already 80%,

01:17 and China is still very low.

01:18 So a lot of room for convergence.

01:20 So I think we want to separate the cyclical problems

01:22 of demand from some of the longer term challenges.

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