The Real Story
China’s economy: How worried should we be?
Feb 2, 2024
Discussion on the concerns surrounding China's economy, the impact of Evergrande's liquidation, the role of property in driving China's middle class growth, the lack of productivity growth, crackdowns on corruption in the tech sector, and China's transition and its impact on the global economy.
48:58
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Quick takeaways
- China's high dependency on property investments and manufacturing jobs, along with rising youth unemployment, pose challenges to achieving a shift towards a more consumer-driven economy and household-driven growth.
- China's emphasis on ideology and government interventions, along with the crackdowns on corruption and tech sectors, have created uncertainty for investors and a chilling effect on entrepreneurialism, impacting the global economy.
Deep dives
China's Economic Challenges and Evergrande's Liquidation Order
China's economy faces challenges as Evergrande, once its biggest property developer, is ordered to liquidate. With $300 billion in liabilities and concerns over access to assets, foreign investors question investing in China. Chinese authorities are taking measures to stabilize financial markets, including restricting short selling. Economists ponder whether China can sustain its past growth and the need for economic rebalancing. China's high dependency on property investments and manufacturing jobs is a concern as youth unemployment rises, causing social unrest fears. President Xi Jinping emphasizes China's resilience, while critics like Joe Biden describe it as a ticking time bomb.
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