BEIJING — The scale of the Chinese agenda for long-term economic change makes piloting the country, the biggest driver of global economic growth, safely past the near-term perils of a hard landing seem straightforward.
Even with structural change, the Chinese economy is likely to grow at a rate nearer 5 percent than 10 percent by the end of the decade. Its mainly poor population will be aging rapidly and its companies will face stronger foreign competition in developed markets still struggling with the deleveraging legacy of the 2008-9 financial crisis.
“Avoiding a hard landing was relatively easy,” said Tao Wang, chief China economist at UBS in Hong Kong. “Economic policy for the near term has been predetermined, and I don’t see any deviation from that.”
Some see the potential for an acceleration of financial-sector changes, particularly to make the tightly controlled Chinese currency more freely convertible, after the recent decision to double the size of the daily trading band in which the renminbi is managed.
Ms. Wang said the broader agenda for change mapped out in the 12th Chinese five-year economic plan would be tougher to deliver.
“Changing the economic structure, reorienting the economy, how to improve income distribution, environmental issues, price distortions, financial sector reforms — all these things have been outlined as important, but there isn’t a very clear timeline as to when these things will happen,” she said.
Prime Minister Wen Jiabao has plenty to do in his final year in office. A plan for 2012 announced in March made 32 pledges for action across nine broad subject areas, with promises to “accelerate,” “deepen” and be “vigorous” in most of them.
Getting through it in 12 months after nine years in which critics say change has slowed will be no mean feat, especially as politics — even in the Communist-ruled, one-party Chinese state — complicate matters.
This is a transition year, when President Hu Jintao and Mr. Wen start to hand over the reins to a new leadership after a decade in power. A smooth transition is the prime objective, which appears to limit leeway for major changes.
But a scandal that has brought down Bo Xilai, a brash populist once widely seen as a contender for a post in the nine-member committee that rules China, may lead to faster economic change in a bid to underpin economic growth and social stability.
“The pace of financial reform is likely to accelerate through 2012 and 2013,” said Xiang Songzuo, chief economist at the Agricultural Bank of China and vice director of the International Monetary Institute, a research group at Renmin University in Beijing.
Change is rarely easy, particularly in capital and currency liberalization, where missteps were at the root of the 1997-98 Asia financial crisis, which China managed largely to evade.