Chinese “New Norma” and Some of its External Outcomes

While the “old normal” of Chinese economic success is no longer feasible, a “new normal” is taking shape in Chinese economic rhetoric, policies and realities. To better understand its meaning and outcomes, we first delineate what the “old normal” was, and then we try to briefly define the “new normal” against this background. The main focus of the paper is on the external implications of China’s shift of emphasis from investment to consumption, from factor-driven, to innovation-led growth, and from foreign to domestic demand, which from a global perspective is, in fact, a fundamental departure from the present global model of China being the “world factory”. We capitalize on the most recent information in the field, as well as on the accumulated knowledge on the subject from the scientific investigations carried out by other researchers, both Westerners and Chinese, trying to push further our own previous research findings.