09/02/2025
China stock markets are down despite recent technology advancements like DeepSeek and its EV revolution. Some of its technological inventions are impressive and has surpassed Western ones. Then, why is still suffering from massive unemployment? Why are Alibaba and etc still struggling?
I think it has got a lot to do with President Xi Jinping subtly taking China out of the global rules-based economy. The reason why China has been able to experience astronomical GDP growth in the early part of the century has to do with been closely integrated with the Western global trading system. It built factories supplies low-cost goods to the far-developed countries. This has lifted out many Chinese out of poverty.
However, now that it has risen to be the world’s second largest economy in the world, it has designs to be the largest. Its solution? Disintegrate itself from the world and going it alone! Promoting self-efficiency instead of relying on its global trading partners. Engaging in an open trade war with the US. Lesser Western investments are now coming into China. While it has great technology, it has not been able to successfully export them to the world. Think about it, you have the greatest products, but you are not able to sell them!
Remember when Emperor Qianlong turned away Lord Mcarthy’s trade delegation because he refused to bow to him? An inwards focused China led to its downfall in subsequent generations. Would President Xi make the same mistakes again? For China to stand tall again, it has to provide itself as a manufacturing hub of the world again and not allow factories to relocate away from it. Because this would provide more job opportunities for its people, otherwise, we may again see a lost generation who like flat, just as we saw during the Cultural Revolution.
