Despite all the recent focus on hi-tech “new infrastructure”, policymakers are still leaning far more heavily on traditional infrastructure construction, which looks set for a boom judging by the recent surge in excavator sales. Given that China’s physical infrastructure is already well developed, the medium-term returns on this investment are likely to be low. But in the short-run it will drive a rebound in the number of high paying jobs for migrant workers, who were hardest hit by the COVID-19 downturn. This in turn should ease the strains on household balance sheets that are holding back the recovery in consumption.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services