Date
18 November 2017
Goldman Sachs' Ha Jiming says China's productivity will reach a turning point next year, when the labor force peaks as baby boomers begin to retire. Photo: HKEJ
Goldman Sachs' Ha Jiming says China's productivity will reach a turning point next year, when the labor force peaks as baby boomers begin to retire. Photo: HKEJ

Next 18 months crucial for China restructuring bid, says banker

The next 18 months will be crucial for the Chinese government in its effort to restructure the economy, the Hong Kong Economic Journal reported, citing investment banker Ha Jiming.

Ha, vice chairman and chief investment strategist for China investment management at Goldman Sachs, said the country’s productivity will reach a turning point late in 2015, when the labor force peaks as baby boomers begin to retire.

As such, economic growth will substantially decline unless the government can tackle in 18 months’ time the problems of overcapacity, excessive debt and soaring property prices, said Ha, who served as chief economist at Beijing-based China International Capital Corp.

Demand in the property market will start to fall after the labor force peaks in 2015. The country has to boost investment in railway construction, water facilities and solar energy infrastructure, or it has to give up on its 7 percent growth target by 2015, Ha was quoted as saying.

However, it takes a thorough structural reform to achieve a healthier and sustainable growth level, he said. The government has to open up of monopolistic markets to attract more foreign investment, Ha added.

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