Demonstrates why China has the potential to re-accelerate to 8% growth rate in the medium run. * Provides evidence that the current slowdown since 2010 is largely due to external and cyclical factors. * Discusses structural and institutional obstacles to growth re-acceleration and provides appropriate policy suggestions. After more than three decades of unprecedented high growth at an average rate of nearly 10% per annum, China's economy has been slowing down since 2010, dropping to 6.9% in 2015, the lowest annual growth rate since 1990. As the world's largest economy in PPP terms and the second largest in terms of nominal exchange rates, such a slowdown has profound implications. The whole world is asking if the Chinese economy will continue to slow or be trapped in low growth. This paper presents a rather optimistic outlook for the Chinese economy, concluding that a reacceleration to 8% in the medium run is possible under favorable conditions. We argue that the main factors that led to the slowdown since 2010 are external and cyclical. Nevertheless, structural and institutional obstacles to the re-acceleration of growth are also discussed, together with policy suggestions.