Two engines to beat mid-income trap

A more liberalized market and government reforms, the two engines highlighted by Premier Li Keqiang at the World Economic Forum in Davos, Switzerland, on Jan 21, are expected to help China avoid the middle-income trap on its way to a high-income society.

The key message of Li's long speech was how China would perform in the face of an economic slowdown and low-quality economic structure. Although people want to know whether and how China would be able to beat the middle-income trap, in which some Latin American economies were caught toward the end of the 20th century, Li used humor to provide an answer.

He said Davos is a beautiful town. In the past, it was famous for producing penicillin to cure lung diseases. Now, it is famous for providing an intellectual platform to nurture the brain. The difficult and complicated situation in today's world implies that "we now need a different kind of penicillin".