Foundation for economic transition needed

Economy | Ed Zhang

Once again, Chinese investors' confidence was put to a stress test recently after a small rally that lasted less than two weeks. It seems despite the economy's reasonable performance in the first half of the year, there are still many stumbling blocks that China must try to steer clear of in the second half.

China will have to keep up its domestic growth momentum considering the uncertainties in the global market, such as the Middle East, Ukraine and the eurozone; and in the United States, where the risk of so-called secular stagnation - which means savings are greater than investment and lead to higher than normal unemployment rates - exists.