1 to 2 of about 2
Beijing’s economic policymakers largely accept that China must rebalance its economy so that growth is driven more by domestic consumption and less by investment. But once China begins to take seriously the need to rebalance its economy, China’s annual GDP growth is unlikely to exceed 2–3 percent for many years, unless there is a substantial increase in the growth rate of consumption.
Policies are not “protectionist” because they violate WTO trade rules. They are protectionist if they distort global trade by generating beggar-thy-neighbor trade surpluses. Because large, persistent trade imbalances would be all but impossible in a well-functioning global trading system, the irony is that U.S. policies to reduce its deficit actually enhance free trade.