China 🇨🇳 has seen better days, & post-COVID, the communist regime’s power might be fading. While this would be a welcoming outcome for enemies of the Chinese government, the collapse of the world’s second-largest economy could drag down numerous nations still dependent on the Asian giant.
Desmond Lachman of the American Enterprise Institute recently told Reuters that China’s economy is unlikely to eclipse the United States anytime within the next 20 years. Economist Paul Krugman, also a New York Times columnist, likens China to Japan in the early 1990s. That’s when runaway growth came to a screeching halt and worries about an Asian nation’s world domination proved wildly unfounded.
Japan, at least, had become a rich country by then. China still isn’t, and it may never join the ranks of so-called advanced economies.
China faces many structural and cyclical problems, including a declining population, likely to make India the world’s most populous country sometime this year or next. China has relied far too heavily on debt-fueled real estate projects to power its growth, which has now produced an ongoing real estate collapse some liken to a “Lehman Brothers moment” for China.Yahoo! Finance
According to Yahoo! Finance, leading Presidential contenders in both major parties (Democrats & Republicans) have a hostile outlook towards China 🇨🇳, which means the communist government will not see any relief from American sanctions anytime soon.
While many businesses are attempting to exit China 🇨🇳 as soon as possible, far too many are dependent on the Asian giant when it comes to inexpensively manufacturing products in high demand worldwide.
A collapsing China 🇨🇳 will result in three scenarios, none welcoming to anyone outside of politics.
- China 🇨🇳 collapses, bringing about a world recession (or exacerbating a post-COVID recession that many nations are experiencing)
- China 🇨🇳 collapses & tries to reignite its economy by starting a war with Taiwan 🇹🇼 (resulting in a world war)
- China 🇨🇳 collapses & either fractures apart (an extreme scenario) or experiences a coup by the military (life for citizens underneath remains the same)
Could China 🇨🇳 avoid collapse & emerge from this pending crisis more robust than before‽ Sure! But the Chinese government needs to implement workable solutions before the clock runs out & the sun sets on the Chinese economic empire.
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