class=”sc-97fd9fa8-0 jNFKxv”>
In the run-up to the historic annual meeting of the Chinese People’s Congress, at which ruler Xi Jinping (69) reaffirmed his control over the Chinese economy and politics, the defense budget was the focus. The National People’s Congress announced a 2023 defense budget of 1.56 billion yuan, an increase of 7.2 percent year-on-year.
At the same time, however, a generational change is also taking place in the political and economic leadership of the country. According to CNN, a group of respected businessmen is giving way to a group of politicians better known for their close ties to Xi than for their academic qualifications or foreign involvement. These people include Li Qiang (63), Ding Xuexiang (60), He Lifeng (68), Zhu Hein (55) – all politicians who shine more with good party connections than with economic success.
How will China’s economy change?
This prospect is fueling fear from Washington to the UK to Japan as the economic situation in China could deteriorate further. US business agency Fitch Ratings has raised its forecast for China’s economic growth for this year from four to five percent. And China has set itself a target of 5 percent GDP growth for 2023. In the long term, however, a decline in Chinese profitability is expected.
There are fears internationally that Xi’s yesmen will lead China further into state intervention and international isolation – and away from the path set by a dynasty of pro-market and cosmopolitan officials. George Magnus (74), economist and China expert, confirmed this fear in an interview with Blick.
“How exactly these men will change the Chinese economy is still an open question,” he explains. “They are certainly not stupid, but it will be more important for them to implement Xi’s visions than to ensure a liberal and functioning economy.”
China’s balancing act will backfire
Another cause for concern is China’s dangerous balancing act: reconnecting with the West after three years of isolation – while pleasing autocratic friend Russia.
Ralph Weber (48), China expert at the University of Basel, thinks it’s a difficult undertaking: “You played in the middle very successfully for a long time,” he tells Blick. In plain language, this means that while Western democratic states knew they could not support China’s political decisions, things continued to run smoothly economically. At least one thing is clear since the war in Ukraine and China’s partisanship with Russia: “Politics and business could easily be separated – that is no longer possible,” says Weber.
Not a glimmer of hope in the US-China conflict
However, the West is not really disconnecting from China. “There are voices warning that the immense problem they have with Russia would get worse with China,” Weber said. “We must not bite the hand that feeds us, says reason.”
Nevertheless, some international companies, such as Apple, have already moved their headquarters and production facilities from China. Because there is “no hope left” for the relationship between the US and China, according to economist Magnus. “The relationship between the two is rapidly deteriorating.”
At the G20 summit in Mumbai last week, there was one big topic: the looming global debt crisis. The faltering China also plays a major role, writes the “Handelsblatt”.
The G20 countries must ensure that the situation remains stable, Federal Finance Minister Christian Lindner (FDP) said before leaving for Bangalore. The problem: According to the Kiel Institute for the World Economy, China is the world’s largest public donor and the main creditor to about 30 countries.
If the red giant falters, it will likely cut off the flow of money to developing countries. In such a precarious situation, close cooperation with the US would be desirable – but that relationship also leaves much to be desired.
At the G20 summit in Mumbai last week, there was one big topic: the looming global debt crisis. The faltering China also plays a major role, writes the “Handelsblatt”.
The G20 countries must ensure that the situation remains stable, Federal Finance Minister Christian Lindner (FDP) said before leaving for Bangalore. The problem: According to the Kiel Institute for the World Economy, China is the world’s largest public donor and the main creditor to about 30 countries.
If the red giant falters, it will likely cut off the flow of money to developing countries. In such a precarious situation, close cooperation with the US would be desirable – but that relationship also leaves much to be desired.
This is not only a problem for China, but for the whole world. “Everything is getting more expensive, supply chains are getting more complicated and profitability is shrinking.” According to him, there will be a kind of re-globalization in which the West will have to turn away from China and turn to new partners. “A kind of ‘turning point’ in the globalized era.”
Source: Blick
I am Amelia James, a passionate journalist with a deep-rooted interest in current affairs. I have more than five years of experience in the media industry, working both as an author and editor for 24 Instant News. My main focus lies in international news, particularly regional conflicts and political issues around the world.
