Some people seem to think I'm a defender or supporter of the CPC and PRC.

I'm not but 30 year of studying them have demonstrated one thing: they're depressingly durable. Countless predictions of China's imminent economic collapse have proven incorrect.

But currently the Chinese economy is starting to look more and more like the Japanese economy at the start of their "lost decade" of the 1990's.

Back in 1979 when the Dengist reforms started, China had a massive deficit in almost every form of physical infrastructure. Much of China's economic growth since then can be attributed to building infrastructure -ports; airports; railway lines; power plants - that increased economic efficiency.

But that deficit has been largely made up and the economic returns on further investments in physical infrastructure have fallen sharply. This is why, for example, the expansion of the high speed real network has effectively been halted.

Xi and the Presidium know all this - most of them are economists by training. This is why since 2008 or earlier they've been trying to emphasize growth in services and high-tech manufacturing.

Falling back on old-fashioned infrastructure spending smacks of desperation - and as Japan discovered, is unlikely to work.

We see something similar in the energy sector where China is promoting domestic coal production even as they continue to promote wind and solar and attempt to reduce air pollution in major cities. Chinese coal is more expensive and lower quality than imported American or Australian coal - but Chinese coal mining employs a lot of people.

The big question is whether this retrograde shift in economic policy is due to short term factors -the Shanghai lockdown; the war in Ukraine, the debt problems in the Chinese real estate sector - or reflects longer term underlying structural problems.

http://global.chinadaily.com.cn/a/202204/28/WS6269e91aa310fd2b29e59cbe.html