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The New Shape of China’s Economy

BEIJING – China’s leadership transition attracted global attention in 2012, and deservedly so, given the country’s global significance. But, more important, strategic transformations now underway seem certain to influence its future pattern of growth.

For three decades, the dividends from Deng Xiaoping’s initial decision to open China’s economy to market forces, and to the world, have fueled rapid growth. Until recently, the key was China’s vast supply of low-cost labor, which provided the foundation for the country’s export-oriented model.