Scholar Predicts Dead-End for Chinese Economy

Economic Tension and Reform in China: Will Beijing Overhaul its Control over the Economy?

Scholar Anne Stevenson-Yang believes that China’s plan to boost growth through increased exports will only lead to more tension with its trade partners. She argues that years of erratic policies, excessive Communist Party control, and unfulfilled promises of reform have left the Chinese economy with weak consumer demand and slowing growth. In a recent opinion piece in the New York Times, she highlighted Beijing’s failures and predicted that the influx of cheap exports would continue, while the Chinese people grow more discontented with their economic prospects and the Communist Party responds with more repression.

Stevenson-Yang identifies the Communist Party’s excessive control over the economy as the root cause of China’s economic woes. She believes that the party is reluctant to free up the private sector and empower Chinese consumers because it would require a fundamental overhaul of the government structure, which they are unwilling to do as it would diminish their power. She believes that the era of reform and opening in China has come to an end without much progress.

In her analysis, Stevenson-Yang also expresses doubt that China will be able to innovate its way out of the economic slump. She argues that the country’s economic model has been focused on imitating existing technologies rather than developing new ones, leading to a lack of industrial or commercial breakthroughs. As China continues to grapple with economic challenges, the international trade landscape remains turbulent. Recent developments include the US imposing tariffs on Chinese EVs, metals, PV cells, and chips, as well as scrapping export licenses for chipmakers selling to Chinese companies like Huawei. The EU has also raised concerns about China subsidizing EVs and has proposed retroactive tariffs. Despite China’s solar panel costs dropping significantly in 2023, they remain much cheaper than those in the US.

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