China’s rapid economic growth and ineluctable rise faces an unavoidable threat.
Well-flagged dangers, such as asset price bubbles exploding, hidden non-performing bank loans being exposed, inflation adding to rumbling social discontent, or consumption failing to catch up with years of investment in fixed-capital formation, might turn out to be merely temporary glitches, if they materialise at all.
However, that’s not the case for what amounts to China’s ticking demographic time bomb. Unfortunately, too, it is already too late to cut the wires to prevent the bomb from detonating.
“The aging of China is probably the fastest in history,” wrote Sanjeev Sanyal, Deutsche Bank’s global...