Will China avoid a hard landing?

ON CHINA

China's infrastructure-led growth has slowed and defaults have begun in the massive shadow banking sector. China has the tools to avoid a crisis, but can it follow through? ETF Securities' Nicholas Brooks explains.

Despite regular newspaper headlines and analyst reports proclaiming an imminent hard landing and credit crisis in China last year, China's GDP rose by 7.7%, making it one of the fastest growing economies in the world. While the much-feared crisis did not occur and growth remained stronger than many analysts expected, the economy has slowed from the 10%-12% growth rates of the 2009-10 period to a more sustainable 7%-8% range. The slowdown in growth has occurred as a consequence of policy tightening put in place in 2011 to reduce speculative lending and over-investment stemming from the...