Can China exceed US$15,000 per capita?

Can China exceed US$15,000 per capita?

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Many studies have identified a “middle-income trap” at around US$15,000 per capita, where a society’s growth slows and may stop. The HEAD Foundation’s Secretary-General, Professor Gordon Redding, highlighted in this public lecture that societies relying largely on interpersonal trust to stabilize economic relations are at greatest risk of leveling out at this plateau. Professor Redding explained that in China’s case, the middle-income trap is caused by:

  1. Government control of economic action (mercantilism), which results in inefficiency at large scale, and
  2. Reliance on Small Medium Enterprises that cannot grow large because of a lack of trust.

Professor Redding closed the presentation with six hard questions that China would need to address in order to overcome its limitations and escape the middle-income trap.

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Mr Ho Swee Huat

Mr Ho Swee Huat is the Founder and Managing Director of Abacus Assets Advisors Pte Ltd. Before starting the company, he had an established career in the banking industry, with 20 years of experience in Singapore, Hong Kong and New York.

He was an Independent Director and Chairman of the Audit Committee of CapitaCommercial Trust Management LTD from 2004 to 2013.

He is the current Chairman of Autism Association (Singapore) which he co-founded with a group of parents in 1992. He is also Vice-Chairman of Eden School, a special school for children with autism.

Mr Ho holds a Master’s degree from the London School of Economics and Political Science, and a Liberal Arts degree in Economics from Hamilton College, USA.

He has been a member of the Board of the Foundation since its incorporation.