It’s no secret that the global economy is in some trouble. There has been a lot of bad news in the US, Europe, Japan and emerging markets, experts are making dire predictions about a repeat of the 2008 crisis and banking, stock market and housing crashes, and so on. But the biggest news is China and its economic slowdown, which is generating major headlines and alarming predictions like this. These aren’t the only problems the world is facing, as you also have environmental issues, refugees and wars, but for this part of the world (East Asia), the economy might be the most serious one, with China’s slowdown affecting almost every single country in the region and its own regions Hong Kong and Macau.
China’s slowdown has led to a shift in what had been a major story for years – the “rise of China.” This is a story that had been told in countless books, articles and expert analysis, with some proclaiming China would overtake the US and become the world’s biggest economy within decades. I never fully believed this, even in my pro-China days (or I should say, years), but I was optimistic that China would keep rising back then. Now though, for the past year (perhaps longer), its mighty economy is unraveling with stock market crashes (yes, plural since it has happened at least 3 times since last June), yuan devaluation, capital outflows, factory closures, export and import declines, and property price falls.
Personally, I also feel, and maybe my pessimism is a little out of hand, that the economic crisis is also leading to the end of another big theme – the “rise of Asia” story in which the 21st century will be that of Asia’s as the West loses its dominance and importance. China’s “rise” and “dominance” isn’t even unprecedented because decades ago, similar things happened but on a smaller scale such as the rise of the Asian tigers (South Korea, Taiwan, HK, Singapore) and the perception that Japan might soon overtake the US. Nevertheless the latter did not happen and Japan ended up in a prolonged economic slump whilst still remaining a very developed nation. Meanwhile, among the tigers, Taiwan isn’t doing very well and HK faces serious socio-economic and other problems. India is being seen as the new China because of its strong growth and giant population, but I’d say it won’t become a developed nation anytime soon, at least not before it fixes its serious infrastructural, political, social and cultural problems.
But anyways, back to China. The problem would be serious enough even if it was only about the economy, but the government is taking it further by ramping up crackdowns, censorship and basically becoming more repressive, not to mention carrying out its dirty work beyond its borders like the kidnapping of the HK booksellers. China is even expanding media censorship to cover economic news, specifically negative news about its economy. In the South China sea, it has been militarizing its islets whilst lashing out at other countries like the US and Australia, the latter ironically for increasing its military spending. You’d think a country with such dire domestic problems should spend more time fixing them rather than picking arguments with its neighbors and stepping up tensions.
For people who live in East Asia or are interested in China, Asia, or global economic matters, I suggest keeping a closer eye on major news and events this year, especially regarding China.