M&G's Riddell: Is China the new Iceland?

M&G's Mike Riddell has questioned the sharp rise of China's investment to GDP ratio, comparing the figure with former bubble countries including Iceland and Asian countries during the 1997 crisis.

China's investment to GDP ratio has soared to a "totally unsustainable" 54.4%, as growth slows despite unprecedented government spending, the manager said. "Post 2008, China looks a different animal," Riddell (pictured) said. "Productivity and efficiency seems to be plummeting, where GDP growth is becoming dangerously reliant on the ‘inputs', namely soaring investment. "We have all heard about how China's leaders desire a more sustainable growth model, featuring a rebalancing of China's economy away from investment and export dependence and towards one that is more reliant on domestic...