Is China on the verge of a huge crisis?

Submitted by spartakus25 on January 10, 2019

Seemingly the china economy is loosing steam according with the last data about industrial production, vehicles sales and overall consume. All this indicators fallen deep in the last months, and that was not yet a effect created by the commercial tensions with US, because the wall tariffs erected against the china products only will hit fully the exports in the middle of this year. So the slowdown is more a result of the deep internal weakness, mainly the overaccumulation of capital that were since 2009 funded by a vast wave of debt that fuelled bubbles in the whole economy. A crisis in China could produce a range of implications to the global order, since that would trigger a huge devaluation in yuan in order to counter act the output slump, sparking a global deflation that could be disastrous to the monetary stability of the global economy. The markets will get smaller and smaller and hence the competition between capitals and nation will becoming more and more destructive, mounting a perfect condition to war. The present commercial tensions will be a little worry compared to the possibilities of a critical global crisis centered in China.

Spikymike

5 years 10 months ago

In reply to by libcom.org

Submitted by Spikymike on January 16, 2019

We should continue to track this more carefully - see this useful article which highlights some of the immediate contradictions of the Chinese economy even if overly reliant on limited sources of information:
www.wsm.ie/c/next-global-crash-china-and-21st-century-crisis

Nymphalis Antiopa

5 years 10 months ago

In reply to by libcom.org

Submitted by Nymphalis Antiopa on January 25, 2019

Up-to-date information on aspects of China here: http://dialectical-delinquents.com/china-2/

Soapy

5 years 10 months ago

In reply to by libcom.org

Submitted by Soapy on January 25, 2019

China had been maintaining extraordinary double-digit growth through the 1980s, 1990s, and 2000s. The idea that China could continue to grow at this rate seemed pretty far-fetched. In fact, if we go back to 2016 and look at the IMF's forecast for growth in China in 2018 and 2019, it was 6.0 percent for both years. The IMF's forecasts are generally in the middle of professional forecasts. For this reason, it is a bit strange to read an article in the NYT telling us that China's slowdown to 6.4 percent growth last year is really bad news for the world economy.

http://cepr.net/blogs/beat-the-press/how-worried-should-we-be-if-china-s-growth-rate-slows-to-6-4-percent