Scott Rozelle and Natalie Hell. Invisible China: How the Urban–Rural Divide Threatens China’s Rise

Excerpt

After several decades of unprecedented high growth rates, the Chinese economy has now reached an important turning point. The development strategy which was based initially on exploitation of the country’s natural competitive advantages of low labor costs and opening to foreign capital investments (primarily in labor-intensive industries) proved to be extremely successful. It reduced extreme poverty and resource scarcity, transformed the country into the global manufacturing center and triggered a virtuous cycle of national economic performance, which allowed China to gradually climb the ladder of economic development. By the year 2012, China reached the upper-middle income level according to the World Bank’s criteria. In 2020, China became a "moderately prosperous" economy by its own national classification and also declared victory in ending extreme poverty. The Chinese authorities are now envisioning their country as entering the ranks of global "high-income economies" in the near future. …