Nation must be alert to middle-income trap

Finance Minister Lou Jiwei's warning that the country has a "greater-than-50-percent" chance of falling into the middle-income trap in the next five to 10 years sounded sensational because he is the first at that level to say so.

But, unlike some pessimistic forecasts about the country's economic prospects, Lou's apparent raising of the alarm was meant to underscore the vital importance of honoring the promise of "all-round" reforms and maneuvering decent growth. The country may get stuck in the widely feared trap if it fails to do all the necessary homework properly, Lou said.

It may be too early to say whether or not China will beat the trap; the economy is still in the painful process of shifting gear, and the 7 percent growth can hardly be termed stagnation.