The Red Queen economy

[Lawrence]

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It's hard to overstate the economic challenge for other Asian
countries. While their economies are stalled, China's is racing ahead.
"China is the world's lowest-cost producer of everything," says Tim
Condon, chief economist at ING Barings in Hong Kong. When export
demand finally recovers, it is naturally going to gravitate towards
China. Happily though, while China's cost advantages do pose problems
for the rest of Asia, they are not insurmountable.
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Does this mean that China will one day become a developed nation, as wealthy
as the West? If not, what is it that China will become? Even assuming it's
per capita income will never equal Japan's, can it get within 25% of that
level? If so, why can't its neighbors simply copy its policies?