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Mutual perceptions in the United States and China have a growing influence on the bilateral security relationship, affecting how policymakers manage conflicts and seek cooperation.
Both China and its neighbors need to proceed with restraint by focusing on solving pragmatic problems rather than diverting attention to intense territorial disputes
As China shifts away from its traditional debt-fueled growth strategy, resources will have to be reallocated from the state to households. The resulting political tensions will be difficult to manage.
Beijing policy makers do not need creative ways to post higher consumption numbers; they need more efficient forms of demand. China’s problem is rapid credit growth, and the low consumption share is just a symptom of the problem.
Beijing needs to clarify how it will treat surveillance aircraft and other potentially “threatening” military planes that are transiting the air defense zone but not heading toward Chinese airspace.
An “efficient” market is one that has an efficient mix of investment strategies. Without this efficient mix, the market itself fails in its ability to allocate capital productively at reasonable costs.
China’s future lies as much in maintaining political stability as in sustaining rapid growth.
Despite increasing economic ties, diplomatic relations remain icy between China, Japan, and Korea on a number of areas including historical issues, territorial disputes, and North Korea policy.
The reforms necessary to rebalance China’s economy require the political resolve to reallocate resources and benefits from state elites to households.
The Third Plenum offers an opportunity to articulate a vision for shifting China’s economy to a more consumption-led growth model and to lay out the first steps toward accomplishing that vision.