Structural change and reforms have been a key driver of rapid growth in China: over the last decades China specialized into new industries, its people moved to new locations and firms adapted to new global markets. But China’s urbanization and economic growth is at a crossroads. Gains from spatial reallocation of resources are set to decline and exports can no longer be a driver of economic growth. Because urbanization is one of the most important enabling processes in growth, making it work well is critical.