Quality of growth has been the mantra this year, underscoring the profound transformation that is taking place in the Chinese economy in terms of how it should be managed. At a macro level, a slower growth rate is necessary but not sufficient for mitigating financial sector risks. The real question is whether policymakers will be willing to allow some unsound financial institutions and zombie companies to fail at a time of heightened volatility in global financial markets. At the micro level, a number of areas of growth have emerged in consumption or consumption upgrade as well as healthcare, which could allow policymakers to take tough decisions without worrying too much about their adverse effects on the labor market. One of China's great advantages is its speed of decision-making and implementation when compared to most other economies. Such speed is particularly important at the moment as China embarks upon a new project: mapping out smart cities where data sharing is used to tackle urban diseases such as congestion and pollution.
However, smart cities in China cannot be a simple repeat of the previous growth model of mobilizing resources for producing homogeneous products. In a way, the problems China is trying to solve in designing smart cities are a microcosm of a better quality of economic growth and a more inclusive approach to development. As China celebrates forty years of economic reform in the year of dog, we wait to see if the next wave of liberalization will meet, exceed or fall short of people's expectations. Sectors such as pharmaceuticals and energy which encounter stiff headwinds, will prove to be the acid test of commitment to reform. In a nutshell, the collection of articles in this issue is our attempt to address the problems China faces at this crucial juncture in its development, and offer some solutions.