China is not to avoid the crisis

The fact that the Chinese economy has suffered enormous in its destructive impact, is beyond doubt. Large closet loudly falls always. Even a week of downtime for such a huge economy is a lot. If it will be about a month or more — it would be a disaster.

The 2008 crisis, China decided through accelerated development of domestic market through increase in the purchasing power of its population. But miracles do not happen — this is only possible through pumping loans, and today’s growth is provided by only one indicator — the growth of the debt burden. The hope was that the world economy after the recession will be restored, and the interior debt will be gradually covered by export growth. But here lies the key miscalculation of the Chinese authorities, the world market is not dimensionless, and the other players also want to sell their products. USA counteract China through a trade war, in which China is clearly losing. Hence, the concept of avoiding debt crisis, China’s bursting at the seams.

The current epidemic just draws a line under the collapse of the Chinese strategy of the “silk road” — the contradictions were laid much earlier. The epidemic has become a crisis that will break the previous development concept, to carry out China through the disaster and get him to consider other options. The longer the “vacation” is today the sharper and the transience of the crisis, which, of course, will be the system — both economic and political. But it, probably, already inevitable.

Another issue is that the Chinese leadership may go the way of the Russian and death to defend “stability” — that is, no reforms and no reform. Power resources to the suppression of the protests he has enough. But if does not work itself development strategy, an attempt to put her in suspended animation in the hope that, maybe, then somehow it all ends — a road to nowhere. This is a unique disaster in the end but much bigger scale, something that may be today.

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