No country can be productive enough to reinvest half of GDP in new capital stock without eventually facing immense overcapacity and a staggering non-performing loan problem.
Continuing down the investment-led growth path will exacerbate the visible glut of capacity in manufacturing, property and infrastructure, and thus will intensify the coming economic slowdown once further fixed-investment growth becomes impossible. Until the change of political leadership in 2012-13, China’s policymakers may be able to maintain high growth rates, but at a very high foreseeable cost. - in Project Syndicate
Related: iShares FTSE/Xinhua China 25 Index (ETF) (FXI), Morgan Stanley China A Share Fund, Inc. (CAF), PowerShares Gld Drg Haltr USX China(ETF) (PGJ), Aluminum Corp. of China Limited (ADR) (ACH), PetroChina (PTR), China Mobile (CHL)
