The People’s Republic of China is taking a hit economically, after U.S. tariffs, high youth unemployment, a lagging property market, and an increasing national debt, has begun to squeeze the Chinese economy.
According to Reuters financial columnist Jamie McGeever, China’s response to the property crisis and growing deflation is “baffling.”
“The impact of this muted response on China’s economy has been stark. Growth in 2024 is likely to fall short of the government’s 5.0% target, deflationary pressures are intensifying at an alarming rate, investment is collapsing, and credit growth is at a record low,” McGeever said.
McGeever added Morgan Stanley economists are forecasting China’s Gross Domestic Product is expected to only reach 3.9% this year and into 2025. The U.S. economy, meanwhile, is expected to have a GDP growth of 5.5%.
This is a drastic drop from the 4.2% forecast by Morgan Stanley in January, while Goldman Sachs had China with a 4.9% GDP growth, and JPMorgan predicted growth as high as 4.9%.
“China’s stock market is also a notable laggard. As the rising tide of global monetary easing has lifted stock markets around the world to new highs, China has gone in the opposite direction. Shanghai’s blue chip index is down 15% since May, has nearly halved since February 2021, and is close to making new multi-year lows,” McGeever said.
According to a report from Bloomberg, China’s car dealerships are facing an almost $20 billion loss, after Chinese consumers have become reluctant to make major purchases.
The China Automobile Dealers Association said in a statement Monday, the association is appealing to the Chinese government about the dealer’s capital chain causing a price war.
“Recently, the China Automobile Dealers Association has received a large number of member companies to report that the drastic changes in the automobile market brought about by factors such as the continuous ‘price war’ have made auto dealers mired in a quagmire and face the outstanding problem of extremely tight capital liquidity,” the association said.
The association formally submitted the “Emergency Report on the Current Financial Difficulties and Shutdown Risks of Auto Dealers” to the Chinese government, which analyzed the issue, and put forward policy recommendations to deal with it.
“At present, there are large-scale losses in the sales of new cars of auto dealers, and there is a general situation of cash flow deficit operation and the risk of capital chain rupture intensifying, and it is difficult to get rid of the dilemma of survival,” the association said.
As China’s economic woes deepen, many Americans are wanting to decouple from China. Former U.S. Navy SEAL and founder of Blackwater USA Erik Prince, said during an interview with Fox News’ Maria Bartiromo, that the supply chain needs to come out of the hands of China because it is a huge vulnerability for the U.S., and poses several national security risks.
A recent strike by Israel against terrorist organization Hezbollah, targeted 2,800 of its senior leaders through their telecommunication network, while dozens of its members were killed through the detonation of their walkie-talkies the very next day. The strike was carried out by getting into the supply chain, and planting the devices.
Prince said there is a chance China could carry out a similar attack in the U.S. because it has so much access to the supply chain.
“It’s an extreme vulnerability that we have … even the processing of rare earth minerals to the manufacturer of the integrated circuits, to the guts of many of our appliances, to even our pharmaceuticals. Imagine what they [China] could do to painkillers or to basic antibiotics, or to a lot of the stuff still made abroad. It speaks to having to have control, or visibility,” Prince said.
Tense international relationships are also starting to take a toll, after China has repeatedly increased its aggression toward the Philippines with its dispute over the South China Sea. Now India, one of the world’s largest emerging economies, has also voiced its concern over doing business with China.
Despite being a part of BRICS – an international alliance consisting of Brazil, Russia, India, China, and South Africa, as well as Iran, Egypt, the United Arab Emirates, and Ethiopia – India’s commerce and industry minister recently ruled out the possibility of a free-trade agreement between India and China.
During an interview with CNBC, India’s Minister of Commerce and Industry Piyush Goyal, rejected the idea that India would be joining one of the largest trade deals in the world – the Regional Comprehensive Economic Partnership – citing it is not in the best interest of India’s farmers.
“India is not going to join the RCEP because neither did it reflect the guiding principles on which ASEAN was started, nor is it in the nation’s interest to do a free trade agreement with China,” Goyal said.
ASEAN – the Association of Southeast Asian Nations – is a political and economic union of 10 states in Southeast Asia, consisting of Brunei, Vietnam, Thailand, Cambodia, Indonesia, Loas, Malaysia, Myanmar, the Philippines, and Singapore.
The RCEP was first signed in 2020 by 15 Asia-Pacific countries – including ASEAN nations, Australia, South Korea, China, Japan, and New Zealand. India was initially included within the agreement, but pulled out in 2019 citing unresolved “core interest” issues, according to CNBC.
“It was not in our farmers’ interest, RCEP did not reflect the aspirations of our small and micro medium industries and sector, and in some form, was nothing but a free trade agreement with China. When you see from the lens sitting outside the country, you don’t realize how difficult it is to compete against a non-transparent economy,” Goyal said, adding China is “very opaque in its economic practices.”
While China continues to operate its business in a less than transparent way, it is also attempting to infiltrate the U.S. with CCP plants.
American journalist, lawyer, and political commentator Gordan Chang said in an interview with CPAC that China is sending operatives through the southern border into the U.S. mainland to attack Americans.
“I think China is behind some of this immigration, and they’re sending operatives in the United States to attack us. You know, if we go back two years, we were seeing primarily family groups for Chinese coming across our southern border, and those are people who want to live in a free society. But now, about two-thirds of Chinese migrants are single males of military age, traveling without family members coming in packs of five to fifteen,” Chang said.
Chang noted the amount of Chinese nationals who have recently been caught spying for the Chinese Communist Party inside important industries – like Verizon, which recently had a Chinese national working as an IT specialist in Florida, while he sent back intelligence to the CCP.
China has also been buying up farmland all over the U.S., with many of these areas close to important military installations.
“While this is occurring, we are seeing these increased incursions and attempted incursions into our military bases by Chinese. So, I think they are trying to scope out our bases, in preparation for attacks. We’re seeing Chinese migrants take target practice just immediately after they arrive in our country,” Chang said.
Chang added there is also a plan to attack Americans through biological weapons.
“This is an extremely dangerous situation, and one more point, there was a secret Chinese biological weapons lab in Reedley, California, which had at least 20 pathogens according to the official count, and almost 1,000 mice that had been genetically engineered to spread disease. Take the migrants and the mice and you have a biological attack on the United States in preparation for China’s attack on us and our friends and partners,” Chang said.
#China is laying the groundwork to kill #Americans in #America. @CPAC @ChanelRion https://t.co/gKjq0pHBSO
— Gordon G. Chang (@GordonGChang) September 23, 2024
