China's Future.

• Author: Sinclair, Paul

CHINA'S FUTURE

Author: David Shambaugh

Published by: Polity Press, Cambridge, 2016, 224pp, A$33.95.

David Shambaugh's most recent book has its origins in an address he presented at Victoria University of Wellington in July 2014 to the 'China at the Crossroads' conference organised by the university's Contemporary China Centre. In the preface the author describes China's Future 'as a relatively short book about a big topic'. Given the importance of China's future direction in both economic and geopolitical terms not only for the Asia--Pacific region but also globally, this is an extremely important book that deserves a wide readership among government officials, and those in the business community with aspirations to tap into the country's huge market. It should also be on the required reading list for students studying China's current and future role in global affairs.

Shambaugh notes that China is at a critical juncture in its overall evolution. He asks whether China will be able to transition out of what he terms 'the middle income trap' and implement reforms to 'rebalance' the economy to enable it to move up the value chain. His book explores this question and expresses doubts that China can do so if it maintains an authoritarian system of government. He bases this claim on being unable to find a single case of a country that has developed a modern economy without also developing an open democratic system. But as he also acknowledges it is extraordinarily difficult to predict China's future, noting that it is 'professionally hazardous' as the 'Sinological landscape is littered with China watchers' wrong predictions'.

Shambaugh catalogues in some detail what he describes as the severe challenges China faces. He draws on views expressed by China's leaders, but while he finds common ground with them on some points, it seems very unlikely that those same leaders would endorse his prescription of democracy as the answer to those challenges.

The author claims that China's economy is stagnating and could possibly stall. Such an eventuality would exacerbate a range of social problems which would in turn lead to protracted problems for the Communist Party. He argues for a mid-course correction and suggests that the government could be tempted to lurch backward into a neo-totalitarian approach to China's problems. It is hard to argue with his claim that this would not be a positive pathway. In any event, as he notes, the economy's private sector...