Recent performance and key challenges

There has recently been a major revision to the national accounts, increasing the level of real GDP by over one quarter since 2000. Understanding the nature of this revision is important for assessing growth performance, but there are limitations due to the absence of a consistent historical series. Growth in GDP per capita over the last decade has been among the most rapid in the OECD. Most of the explanations for this strong growth performance – notably the effect of a large reduction in competition-curbing product market regulation and financial market deregulation – are of a transitory nature. This raises two questions with important policy implications. Firstly, what is the risk that the current period of strong growth will end with a hard landing? Secondly, what should the policy priorities be to sustain strong growth over the longer term?