“China’s Rebalancing: Recent Progress, Prospects and Policies”

“China’s Rebalancing: Recent Progress, Prospects and Policies”

Rui Mano & Jiayi Zhang

IMF Working Paper No. 18/243

While China’s growth gathered momentum in 2017, rebalancing was uneven and decelerated along many dimensions reflecting the temporary factors behind the growth pickup. Going forward, rebalancing is expected to proceed as these temporary factors recede, but elevated income inequality and leverage will remain a challenge. The authorities are already pursuing several pro-rebalancing policies which could be expanded to support each dimension of rebalancing while reducing trade-offs between them.