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Is China Too Old to Get Rich?

While policymakers and economists believe that the Chinese economy will achieve high-income status within the next two years, its ongoing slowdown and aging population make this highly unlikely. To avoid losing momentum, China must raise household disposable incomes and tackle its demographic crisis.

MADISON, WISCONSIN – In March, Chinese Premier Li Qiang announced an ambitious economic growth target of 5% for 2024. In a subsequent commentary, former World Bank chief economist Justin Yifu Linendorsed the government’s target, predicting that China’s economy will grow at an average annual rate of 5-6% over the coming decade before slowing to 3-4% between 2036 and 2050. Lin also suggested that China could achieve high-income status in 2026, if not 2025. Given China’s bleak demographic outlook, this seems highly unlikely.