How much longer can the Beijing Consensus last?

Just to be clear, there’s never been an acknowledged nor formal definition of the Beijing Consensus, which is an alternative economic development model to those proposed by the Washington consensus.

This article in Foreign Affairs argues time might be running out on this social contract based on a trade-off of political and economic freedoms, when and if the country’s economic growth slows down.

China’s astronomic growth has left it in a precarious situation, however. Other developing countries have suffered from the so-called middle-income trap — a situation that often arises when a country’s per-capita GDP reaches the range of $3,000 to $8,000, the economy stops growing, income inequality increases, and social conflicts erupt. China has entered this range, and the warning signs of a trap loom large.

So far, China has been applying band-aid solutions to social unrests as a result of unfair and inequitable distribution of wealth.  This kind of short-term patching might not be enough to assuage the discontented for much longer.

The reforms carried out over the last 30 years have mostly been responses to imminent crises. Popular resistance and economic imbalances are now moving China toward another major crisis. Strong and privileged interest groups and commercialized local governments are blocking equal distribution of the benefits of economic growth throughout society, thereby rendering futile the CCP’s strategy of trading economic growth for people’s consent to its absolute rule.

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