New Push for Reform in China

This article examines a recent report on economic development of China by the World Bank and government insiders considered to have the ear of the nation's leaders. China could face an economic crisis unless it implements deep reforms, including scaling back its vast state-owned enterprises and making them operate more like commercial firms. The report warns that China's growth is in danger of decelerating rapidly and without much warning, which resembles what has occurred with other highflying developing countries such as Brazil and Mexico. The phenomenon, "middle-income trap", might occur when a certain income level was reached , a sharp slowdown could deepen problems in the banking sector and elsewhere, prompting a crisis.