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China’s Economy Is Heading Toward Stagnation, Not Collapse
Beijing will soon break another record, when the 2008 Summer Games host becomes the first city ever to hold the Winter Games as well. The lack of natural snow at this month’s Winter Olympics will present no hurdle for China’s Communist Party, which will literally move mountains to get the job done. But a much harder task than weather control confronts President Xi Jinping: delivering on his pledge for a fairer distribution of China’s wealth while maintaining stable growth.
The reality is far more complex, and the stakes are growing ever higher. China’s success over the past 40 years—rising to become the world’s second largest economy, and top trading partner of multiple nations—should not be belittled. But nor can it be taken for granted that Beijing will continue delivering the stellar economic performance its citizens now expect, and the growth that foreign investors and governments have come to reply on.
Xi looks to national security and ideology, not growth and pragmatism, to realize his “China dream” of national rejuvenation. And in a watershed moment last year, he added the goal of “common prosperity,” updating a Maoist concept from the 1950s to put reduction of inequalities, expansion of the middle class, and encouragement of entrepreneurship among smaller companies at the heart of China’s economic policies.
While fighting income and wealth inequality is a noble task, the way Xi has gone about it undermines two of the most important dynamos of China’s development model over the past 40 years: private enterprise and the authorities’ trial and error approach to policy change.
Now a proud centenarian, the Communist Party he leads still appears to enjoy strong public support as it strives to deliver a better life for ordinary Chinese. But as Beijing moves further along the road to socialism and eventually, in theory, to communism under the deeply ideological slogan of “common prosperity,” it could well begin to squander the tremendous economic gains it has made during the past 40 years with a more pragmatic, experimental, and open approach to development. Economic stagnation could well threaten the Communist Party’s survival, but it has managed to pull from the brink of collapse before.
Full article:
China’s Economy Is Heading Toward Stagnation, Not Collapse
Xi’s ideology is knocking out the twin pillars of growth.
foreignpolicy.com
LOL even the west gave up on the "China collapse theory" now they changed the goal post to "stagnation".
