Name: Grzegorz Witold Kolodko, Former Vice Prime Minister of Poland; Professor of Political Economy, Kozminski University

Abstract:

China is in for at least a couple of years, and most likely over a decade, of fast growth, over twice as high as the global average and three times as high as the average for wealthy countries. It will not be back, except for potential extraordinary years, to a two-digit growth rate, but it will be still capable of quickly increasing its national income. Some believe that even several decades of it, but this is an erroneous view.

The China’s impact on what is going on in the world are growing and they will continue to grow in the foreseeable future. This process cannot be stopped, or even less so reversed using peaceful methods. And other methods are out of the question. Everybody else must acknowledge this, regardless of their own interests and subjective affinities. We need to take a leap forward again and try and find the right place for ourselves in the changing world of the future.

In the long term the most serious of them are the social and economic consequences of aging population. Half a century ago state system pension of every Chinese person was funded from contributions of five people in working age; at present it is funded by three people. Presently, there is one elderly person, no longer fit to work and earn money, per five employees; very soon, in 2035, there will be one such person per two employees.

A significant question presents itself: are we really in for a “hard landing” of the Chinese economy and what consequences would it have? What should the rest of the world, especially its rich regions in Asia, Europe and America, wish for?

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