China has faced multiple crises, including a collapsing job market due to excessive COVID policies, a real estate market collapse, and a loss of over $6 trillion in public companies.
These events are not random but result from critical policy decisions, market speculation, and greed.
China's economy is heading towards a significant debt crisis and potential stagnation.
China's GDP growth fell from 6% in 2019 to 2.2% in 2020 due to the COVID-19 pandemic.
Despite negative growth in other countries like the US, China managed to grow by increasing investments, mainly through state-owned enterprises, offsetting the decline in personal consumption.
This growth was achieved through significant debt accumulation, which will be crucial in understanding China's current debt crisis and hidden economic problems.
In 2021, China saw a GDP growth of 8.4%, but the resurgence of COVID-19 led to the implementation of the zero-COVID policy, causing economic growth to drop to 3%.
The zero-COVID policy severely impacted China's economy, leading to the shutdown of the country and reduced economic growth.
Many foreign companies closed their China-based operations and laid off workers, with a significant number of foreign-invested enterprises exiting the country.
China experienced one of the worst real estate collapses in history, starting in the mid-1990s with the rise of the middle class and increased demand for housing.
A new property developer model allowed developers to sell apartments before completion, leading to rapid growth and debt accumulation for companies like Evergrande.
In 2021, Evergrande, the second-largest property developer in China, defaulted on its debts, owing $35 billion to Chinese banks and foreign investors.
The property market collapse has affected the wealth of Chinese citizens and represents a significant portion of the country's economy.
Chinese and Hong Kong stocks have lost a total of $6.3 trillion since their peak in 2021, with Tokyo surpassing Shanghai as Asia's largest equity market.
The real estate market troubles and rising political tensions between the US and China are key reasons for investors pulling out of equity markets.