China: Challenge of the Middle-Income Transition

The Chinese economy grew by 7.4 percent in 2014 and is expected to expand by 7.0 percent this year. These are impressive growth rates for any country but lower than what has been achieved in the past. For three solid decades, since the beginning of market reforms in the late 1970s, the economy expanded by an annual average of almost 10 percent.

Rapid gro…