China

The spectacular rise and fall of China. China was a backward country economically speaking for many years but in 1980 they opened the door to the free market while maintaining communist control of the government. The West thought that this would be the end of communism saying that once people experience economic freedom, political freedom would follow but this did not happen. The country experienced economic growth and in 2000 China was allowed into the WTO and the growth accelerated rapidly, making China the envy of the world. In 2013 Xi jinping took over and was worried that the private sector was getting too powerful, so he instituted various controls to bring back power to the central government. He removed any competitors and in 2018 set up the rules that allow him to be president for life. Then things took a turn for the worst as a combination of events collided. During the fast growth millions of people moved from the country to the city for better jobs. This meant fewer children would be born since having a large family on the farm helps but not so in the city. To further aggravate the problem, China introduced a one child policy in 1980 and during Covid many died, so Chinas population is way down, some say less than 900 million. Official government data still shows 1.4 billion. As the economy grew so did wages and so other countries started getting foreign investment that had previously gone to China. When Trump placed tariffs on China this caused further economic problems. Last week Xi declared that the government would ease some controls to allow the private sector to reinvigorate but some say it is too little too late. China’s demographics where there are too many old people and not enough young people has put them on a downward path from which they cannot recover. Chinas economy depends on exports and these are challenged by other countries like Vietnam and Indonesia.