Investing in China - post-growth pains China is falling back to earth, seemingly without a thud. The last decade was about breakneck growth. This one will be about sustainable growth - recent economic data suggest it might be able to achieve that without crashing first. That means a shift away from wasteful infrastructure investment toward consumption, while stamping out corruption and looking after the environment along the way. Well, that is the aim, at least. But how should investors play this shift? Equities look cheap. The Hang Seng trades on 11 times forward earnings, half the level at the end of 2009, and 1.4 times book value. But then banks make up two-fifths of the index and they are cheap for good reason - many stimulus-spending debts are yet to be repaid. Meanwhile much of the excitement in consumer stocks is already priced in, yet costs and competition are intensifying. For example, Tingyi, the noodle company, trades on 33 times earnings. The same can be said of foreign companies with big exposure to China such as Yum Brands and luxury goods makers. Only the valuations of Chinese US-listed stocks have cooled as short-sellers pick them off. As for resources, China is still urbanising, so there is still demand. But the binge is over, and the global resources industry needs to adjust. Recent Government spending plans should benefit railway, healthcare, natural gas and waste and water sectors, as well as those where regulation should loosen - gas price reform, for example. PetroChina has already started rallying on those expectations. That leaves fixed income and exposure to renminbi appreciation. For investors with access to the mainland bond market, returns on local government bonds are as high as 15 per cent. But this market is nascent and a grasp of the finances of provincial governments is required. Offshore dim sum bond prices are down while renminbi appreciation expectations waver. The China growth story is not over. But making money from it looks to be harder than ever.