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Justin Fox

China's Consumers Have a Long Way to Go

They won't be the next engine of global growth.
More sizzle than substance.

More sizzle than substance.

Photographer: Kevin Fray/Getty Images

The Chinese growth miracle of the past few decades has been driven by investing and exporting, not consumer spending. Lately, though, we’re hearing a lot about a “great rebalancing” in which domestic buyers of cars, phones, clothes, health-care and other consumer goods and services come to play a much bigger role in China’s economy.

This would be swell -- both for China and for a global economy that’s also in need of some balance. Before we all get excited about it, though, it’s important to remember just how unbalanced China’s economy is.