让预言中国经济即将崩溃的观察家们感到失望的是，2014年中国经济安然无恙。房地产市场没有崩溃，影子银行未发生重大违约，地方政府债务仍在掌控之下。产能的确过剩，但它没有把经济拖向硬着陆。现在再说中国经济增长率离政府2014年达到7.5%的目标不远，也应该是马后炮了。

2015年中国经济前景如何？直到2012年，多数中国经济学家还希望经济会强劲反弹，并回归他们已经习以为常的增长轨道。现在他们放弃了这个希望，转而认为经济已经进入一个新阶段，在相当长时期里增长率将明显降低。这就是所谓“新常态”，它的特点是三个变化。

首先，中国经济的高速增长成为过去。未来相当长时间里，经济增速将徘徊在不起眼的7%甚至更低水平。第二，只要经济增速未触及某一个底线，这个底线也许是7%，那么，政府即使有能力，也会避免使用扩张性财政货币政策去刺激经济增长。第三，更加坚定地继续进行以市场为导向的改革，哪怕在一定限度内牺牲经济增长。最重要的年度经济会议，也就是刚刚结束的中央经济工作会议，看来赞同这一观点。

2014年经济的主要特征是产能过剩。经济出现产能过剩时，传统的对策很简单，那就是利用扩张性财政货币手段刺激总需求。但中国目前产能过剩是结构性的，而不是周期性的。中国过去20年以投资和出口驱动为特点的增长模式已经失去动力。

中国的投资大致包括三个主要组成部分：制造业投资、房地产投资和基础设施投资，按照摩根士丹利统计，2013年这三种投资分别占固定资产投资的34%、23%和18%。1998年以来，作为最重要的增长引擎，中国房地产一直保持着20%以上的增速，比国内生产总值增速快一倍。

经过20年的房地产投资热，中国建造了太多的五星豪华酒店、丑陋的摩天大厦、空荡荡的购物中心、宏伟的政府办公楼和高级公寓。作为一个人均收入6700美元的国家，中国的住房拥有率超过80%，这使美国的65%相形见绌，更别说德国的40%。这是非常严重的资源错配。

政府担心房地产泡沫，担心房价暴涨加剧普通百姓特别是大城市居民的不满。根据最近的一项研究，中国城市中每五套房就有一套空置，而同时，在上海一对年轻夫妇必须工作24年，不吃不喝才能攒下足够的钱购买一套中型公寓。为此，政府决定调整住房供应结构，同时严格控制房价。前者说起来容易做起来难，而后者造成的结果是到2014年10月房地产投资增长速度降到12.6%。现在即使最乐观的房地产开发商也改变了看法，承认房地产投资在2015年有可能进一步下降。

房地产投资放缓不仅直接影响经济增长，它给制造业投资带来的影响也拖累了经济。本世纪初，政府错误地把房地产发展作为经济支柱，相当大比例的经济活动受制于房地产发展的需要。钢铁业就是一个例子。中国建了几千座钢厂，生产能力达10亿吨，占全球的一半。随着房地产发展放缓，大部分钢厂随即倒闭。2013年，两吨钢的利润只能买一根棒棒糖，2014年情况也没有多少改变。制造领域的许多其他行业也是如此。

出口与消费又如何呢？多年来出口一直拖累经济增长，中国已经是世界最大出口国，但对于中国的出口能力来说世界太小。中国的出口有竞争力，但不是无敌的。

在中国的总需求当中，哪些部分能快速增长到足以抵销房地产投资和出口放缓给经济增长带来的负面影响？近年，家庭消费虽然有波动但总体趋于上升。但考虑到它在经济中占的比重相对较小以及存在消费惯性，消费增长不可能一下子成为增长的引擎。

也许唯一的救命稻草是基础设施投资。事实上，中国已经计划修建更多铁路和高速公路。所谓丝绸之路战略肯定可以帮助缓冲中国的硬着陆，虽然这个新努力可能给经济带来新问题。除了丝绸之路这个大项目，中国的空气令人窒息，水污染严重，医疗服务很差，中国必须弥补这些领域的投资不足，不过，要做到这一点，中国首先必须有足够的动机，而且由于消化能力和资金有限，公共投资必须以渐进方式增加。罗马不是一天建成的。一年时间里可以建许多医院，但短期内无法却培养出合格的医生和护士。

过去几十年投资和出口高速增长的结果是，中国投资占GDP的比重接近50%，到目前为止是世界上最高的。中国出口占GDP的比重在经济大国中也是最高的。即使中国仍然有财政和金融能力推动投资和出口增长，它也应该避免这么做。否则将来产能过剩问题会进一步恶化。

中国需要做的是把增长模式从需求拉动转向以创新为基础。只有增长建立在创新和创造的基础上，供给才会自动引导需求，产能过剩问题才会解决。但这已不再是简单的经济问题，而且转变需要时间。即使中国能进行这样的调整，一些长期的不利因素，如人口老龄化，也会悄然而至，给中国经济前景带来巨大的不确定性。

短期内，一方面由于产能过剩中国经济将继续放缓，另一方面，基础设施投资和家庭消费的增长能部分填补房地产投资增长回落导致的需求不足。这样，中国经济应该能在2015年取得7%的增长率。

2015年中国的金融形势更加不稳定。金融危机的幽灵将继续困扰经济。但很难判断金融危机是否、何时以及怎样在中国触发。目前存在很多潜在的触发因素，包括房地产泡沫、影子银行活动、地方政府融资平台违约和资本外流。不管是由于什么，金融危机的根本原因几乎无一例外是债务的不可持续。中国总债务与GDP之比已经超过250，企业债与GDP之比大约在120到150，是目前世界上最高的。幸运的是，除了有庞大的外汇盈余，中国家庭债务与GDP之比很低，公共债务总体状态良好。在我看来，2015年及以后中国面临的最大挑战是伴随着经济放缓的企业高负债率。

总而言之，2015年对中国来说是非常具有挑战性的一年。但人们不该忘记中国应对挑战和保持经济运行的非凡能力。赌中国经济即将崩溃是件非常危险的事，观察中国的专家们应该汲取这个教训。

To the disappointment of those China observers, who bet on a coming collapse of the Chinese economy, the year of 2014 for China was rather uneventful. The real estate market didn't crash and there were no major defaults of shadow banks. Local government debts are still under control. Overcapacity? Yes, but it failed to drag the economy into a hard landing. At this point in time, it should be a bygone conclusion that China will achieve a growth rate not far apart from 7.5 percent, the target set by the government for 2014.

What is predicted for the Chinese economy in 2015? Until 2012, most Chinese economists still hoped that the economy would rebound strongly and return to the growth trajectory they had become accustomed to. Now, they have given up such hope. Instead, they believe that the economy has entered a new stage, in which a significant lower growth rate will last for a relatively long period of time. This is the so-called “New Normal,” which is characterized by three changes.

First, the high growth of the Chinese economy has become a thing of the past. For a quite long period of time in the future, growth of the economy will be hovering around an unimpressive rate of 7% or lower. Second, the government will avoid using expansionary fiscal and monetary policy to stimulate growth as long as the growth rate has yet to hit an unspecified bottom line—7 percent probably, even if there is still ammunition left in the government arsenal. Third, further market-orientated reforms will be implemented in a firmer manner even at the expense of growth—up to a limit. The just wrapped-up central economic work conference, which is the most important annual conference on economic affairs each year, seemed to have endorsed this view.

Overcapacity is the key feature of the economy in 2014. When an economy is suffering from overcapacity, the traditional countermeasure is straightforward: using expansionary fiscal and monetary policy to stimulate aggregate demand. However, China's current overcapacity is structural rather than cyclical. Its growth paradigm over the past two decades characterized by investment and driven by exports has run out of steam.

China's investment roughly consists of three main components: manufacturing investment, real estate investment and infrastructure investment, which, according to Morgan Stanley, account for 34 percent, 23 percent and 18 percent of fixed asset investment, respectively, in 2013.[1] Since 1998, as the single most important driver for growth, China's real estate investment has maintained a growth rate of more than 20 percent, more than double of that of GDP growth.

After two decades' investment-mania in real estate, China simply has built too many luxury five-star hotels, ugly skyscrapers, empty shopping malls, imposing government office buildings, and high-end condominiums. As a country with per capita income of $6,700, China's home ownership has surpassed 80 percent, dwarfing the U.S.'s 65 percent, let alone Germany's 40 percent. This is a massive misallocation of resources.

The government is worried about real estate bubbles and the growing resentment towards skyrocketing house prices among ordinary people, especially those dwellers of municipal cities. According to a recent study, more than 1 in 5 homes in Chinese cities are empty.[2] However, at the same time, for a young couple in Shanghai, they have to work for 24 years without spending a single penny to save enough money to buy a moderate flat. In response, the government tries to adjust the structure of house supply and clamp down on house prices at the same time. For the former, it is easily said than done. As a result of the latter, growth of real estate investment has fallen to 12.6 percent up to October in 2014. Now even the most bullish real estate developers have changed their views and admitted that real estate investment is likely to fall further in 2015.

The slowdown of real estate investment not only has hit growth directly but also dragged down the economy via its impact on manufacturing investment. The government has mistakenly targeted real estate development as the pillar of the economy since early 2000s. A very large proportion of economic activities are subject to the need of real estate development. The steel industry is a case in point. China has built thousands of steel mills with production capacity of 1 billion  tons, which accounts for half of the global total. With the slowing down of real estate development, the bulk of steel mills immediately went under. In 2013, profit of two-ton steel was just enough to buy a lollypop. In 2014, the situation will not change much. The same is true of many other industries in the manufacturing sector.

Then, how about export and consumption? Export has been a drag on growth for years. China has already been the world's largest export nation. The world is too small for China's export drive. China's exports are competitive, but not invincible.

Are there any components of aggregate demand in China that can increase fast enough to offset the negative impact of the fall in real estate investment and export growth on growth of the economy? In recent years, household consumption has tended to increase, while having some ups and downs. However, due to its relatively small share in the economy and consumer inertia, consumption growth cannot suddenly become the engine of growth.

Perhaps, the only straw is infrastructure investment. In fact, China has planned to build more railways and highways. The so-called silk-road strategy certainly can help China to cushion a hard landing, though it is also likely that this new endeavor will cause new problems for the economy. Besides this grand project, China's air is chocking and poisoning water; it is aging quickly; its medical services are pathetic.  China has to make up the deficiency in investment in these areas. Nevertheless, to do so, China has to put adequate incentive in place first, and, due to the limits of absorption capacity and funding difficulties, public investment has to increase in a gradual fashion. Rome was not built in one day. You can build many hospitals in one year, but you cannot train qualified doctors and nurses in a short period of time.

As a result the high growth rates of investment and export over the past decades, China's share of investment in GDP has approached 50 percent of GDP, by far the highest in the world, and its share of export in GDP is also the highest among the large economies. Even if China still has the fiscal and financial ability to speed up investment and export growth, it should refrain to do so. Otherwise, overcapacity will get worse in the future.

What China needs to do is to shift the growth paradigm from demand-led to innovation-based. Only when the growth is based on innovation and creation, can supply automatically lead to demand and the Chinese-style overcapacity be overcome. However, this is no longer simply an economic issue and the change will take time. Even if China can embark on such adjustment, some long-term unfavorable factors such as aging will creep in and create large uncertainty for China's economic future.

In short, on the one hand, due to the overcapacity, the Chinese economy will continue to slowdown; on the other hand, growth in infrastructure investment and household consumption can partially fill in the demand deficiency left by the fall in growth of real estate investment. As a result, the Chinese economy should be able to obtain a growth rate of 7 percent in 2015.

China's financial situation in 2015 is more precarious. The specter of a financial crisis will continue to loom over the economy. However, it is difficult to judge whether, when, and how a financial crisis will be triggered in China. There are many potential triggers. Among them are a real estate bubble, shadow-bank activities, defaults of local government finance vehicles (LGFV), and capital flight. Whatever the trigger is, the fundamental cause of the financial crisis is, almost without exception, attributable to the unsustainability of debts. China's total debt-to-GDP ratio has surpassed 250. Its corporate debt-to-GDP ratio is around 120 to150 percent, by far the highest in the world. Fortunately, on top of its very strong external position, China's household debt-to-GDP ratio is low and its public debt on the whole is still in a good shape. In my view, the biggest challenge facing China in 2015 and beyond is the high corporate debt ratio compounded by the slowdown of the economy.

All in all, 2015 will be a very challenging year for China. However, no one should forget China's extraordinary ability to muddle through challenges and keep the economy going. To bet on the coming collapse of the Chinese economy is a very dangerous business. China observers should have learned this lesson.

[1] http://www.forbeschina.com/column/ZhuHaibin

[2] http://www.wsj.com/articles/more-than-1-in-5-homes-in-chinese-cities-are-empty-survey-says-1402484499