THE debate over whether China is headed for a "hard landing" or not in two years' time is heated, one month after noted economist Nouriel Roubini issued a pessimistic forecast on the subject.

Roubini is not the only bear on China, but his reputation adds weight to that side of the argument. The professor at New York University's Stern Business School emerged as a leading voice in global economics after he successfully called the 2008 global financial crisis, earning him the nickname "Dr Doom."

Last month, Roubini warned about the dangers of investing in the world's second-largest economy. He said China is awash with excessive supply of money, infrastructure and property, citing new airports that stand empty, highways to nowhere, massive new government building projects, ghost towns of residential development and new aluminum smelters closed to prevent global prices from plunging.

His conclusion: China's economy will suffer a hard landing, most likely after 2013.

So what exactly is a "hard landing?"

Dictionaries tell us that it occurs when an economy that has recorded a period of very rapid growth experiences a severe slowdown, normally due to overheating and excessive policy response, such as substantial credit tightening or a revaluation of the currency.

It's true that China has experienced "very rapid" growth, when its economy is compared with those of most Western countries now struggling to stay out of recession. But compared with the recent history of China, the growth doesn't look quite so "rapid."

In the first three months of this year, China's gross domestic product expanded 9.7 percent from a year earlier, slowing from a 10.3 percent pace in 2010.

In the past decade, China's quarterly economic growth has swung from a low of 6.6 percent in the first quarter of 2009 after the global financial crisis, and 12.2 percent in the second quarter of 2007.

The trend is certainly a slowing trajectory.

The latest 9.7 percent growth recorded in the first quarter compares with 9.8 percent growth in the last quarter of 2010.

Wang Qing, a Morgan Stanley economist, said there is no doubt that China's growth will decelerate through 2020. But the focus, Wang said, should be on how growth slows. Morgan Stanley is predicting average annual gains of about 8 percent in the next few years.

There's an old joke that economics is the only field where two people can win a Nobel Prize for saying the opposite thing. Yet governments and investors rely on economic forecasts, no matter how disparate the predictions.

The usual medicine

In his book "The Airport Economist," Australian economist Tim Harcourt says advice is often more theoretical than practical and often delivered in haste. Harcourt nowadays is chief economist for the Australia Trade Commission.

His book starts with a story of the late Milton Friedman, the father of the Chicago School of Economics. In 1974, Friedman suggested the usual medicine to Australian policymakers: Fight inflation first by using monetary policy, balancing the budget, deregulating the financial markets and reducing the size of government.

According to Harcourt, Friedman gave this advice at a press conference at the airport upon his arrival in Australia. It came before he really had the chance to examine first-hand the situation in the country. As a result, his detractors dubbed him the "airport economist."

No one can accuse Roubini of making predictions on the fly after his two trips to China to have a look at conditions.

But China is a very big country where economic conditions vary greatly from region to region. It's still a bit of mystery about which places Roubini visited and how many empty airports, pointless highways, government buildings and ghost towns he actually witnessed.

In some cases, what appear to be "ghost towns" and "vacant properties" may actually be reflections of a changing market conditions.

Sun Yu, an independent economist in China, said empty - but sold - apartments are not products of speculation. They serve as a weapon to counter inflation and a tool to propel urbanization.

"In many lower-tier cities, the housing market started to take off when local governments began building satellite cities to host new businesses that downtowns could not absorb," Sun said. "Well-off locals bought second homes so they could rent them out to migrant workers.

"Yet in most big cities," he said, "where surging home prices have made rental income negligible, people buy multiple homes as a long-term investment to guard against inflation and other business risks."

Sun said he believes the number of vacant properties will fall as government incentives favoring inland business development begin to attract manufacturers and migrant workers.

Shaun Rein, founder and managing director of the China Market Research Group, a strategic market intelligence firm based in Shanghai, said Roubini rightly points out that fixed investment at 47 percent of GDP is too high - if it were a long-term strategy.

"The increase is a short-term stimulus to offset lowered exports due to the world's malaise," Rein said. "Short-term increases in fixed investment, like building railroads and airports, are smart strategies to maintain employment rolls and build confidence."

He said the dangers of overinvestment occur when investments are unproductive, and China is not an example of that.

Ye Tan, an economics columnist in Shanghai, said China's growth vitality is partly reflected in the arrival of power shortages this year in parts of China, occurring well before the usual peak summer season.

"The imbalance between high coal prices and regulated electricity prices is one reason. But we can't ignore the contribution of China's expanding industrial output," Ye said. She said she disagrees with Roubini's view of a hard landing in China in 2013.

Roubini's therapy for China? Save less, reduce fixed investment, cut net exports as a share of GDP and boost consumption. Those ideas are largely incorporated into the national government's 12th Five-Year Plan, which started this year.

Roubini is right in noting that bolstering domestic consumption to power growth has largely been rhetoric so far in China.

China's retail sales in the first quarter grew 16.3 percent from a year earlier, down 2.1 percentage points from the 2010 pace. Adjusted for inflation, the first-quarter pace was 10.9 percent, the weakest since 2008.

"The lower-than-expected spending figure dealt a heavy blow to believers that China's economy can rely on domestic consumption," Ye said.

Other big challenges include struggling small exporters in coastal cities, the increase of non-performing loans held by banks, and the looming and serious industrial power shortages, Ye said.

"China's economy has risks, but it is not yet at the brink of a collapse."

She said she respects economists who pay attention to detail and who are willing to "stay at ports and count the number of containers."

What Professor Nouriel Roubini wrote after his visits to China:

I'm writing on the heels of two trips to China …. My meetings deepened my own impression and Roubini Global Economics' long-standing house view of a potentially destabilizing contradiction between short- and medium-term economic performance:

The economy is overheating here and now, but I'm convinced that in the medium term China's overinvestment will prove deflationary both domestically and globally. Once increasing fixed investment becomes impossible-most likely after 2013-China is poised for a sharp slowdown. Continuing down the investment-led growth path will exacerbate the visible glut of capacity in manufacturing, real estate and infrastructure.

I think this dichotomy between the high-growth/inflation pressures of the next couple of years and growth hitting a brick wall in the second half of the quinquennium is far more important than the current focus on a "soft landing" amid double-digit growth.

A number of local scholars close to policy circles agree that this is the biggest challenge of the next few years, as we've been saying for months.