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The topic of the collapse of China’s economy is as old as the propaganda mechanism in the West. It was foreshadowed 20 and 10 years ago, when China’s GDP was growing by 10% annually. Expectations of Chinese apocalypse in the Western media have sharply intensified in the last two months, when the U.S. administration is intensively seeking diplomatic approaches to the Chinese leadership in order to reduce tensions in bilateral economic relations. On the eve of the US presidential election in 2024, President Biden’s team clearly needs Chinese support and stabilization of mutual trade, on which the situation inside the US largely depends.
As a programmatic example, we can cite an article in the American newspaper Wall Street Journal under the headline «China’s economic growth, which lasted almost 40 years and made the country’s economy one of the largest in the world, has come to an end.» It is illustrated with an impressive photo by the Bloomberg agency showing an unfinished viaduct and the caption, «A highway project in Guizhou Province has stalled.» Lo and behold, China has abandoned bridges and roads, all in disrepair, says a leading U.S. economic newspaper. The WSJ says the growing economy allowed Beijing to invest for decades in building factories, high-rise buildings and roads. «That model sparked an extraordinary period of growth that lifted China out of poverty and turned it into a global giant whose export prowess spread around the world,» the paper says. According to the newspaper, that economic model is now no longer functioning and Chinese authorities are running out of capacity to expand infrastructure, with underutilized bridges and airports in some parts of the country. Meanwhile, millions of apartments stand empty and the return on investment has fallen sharply. «Signs of trouble are visible not only in China’s dismal economic data, but also in outlying provinces, including Yunnan in the southwest, which recently said it would spend millions of dollars to build a new COVID-19 quarantine facility nearly the size of three soccer fields, despite China ending its «zero COVID» policy months ago.» But that’s not all, it turns out China’s economy is facing unfavorable demographics in the country and a «widening gap» with the United States and American allies, which, according to journalists, could affect investment in the Chinese economy. «This may not just be a period of economic weakness, but the sunset of a long era,» the journalists said.
It is pointless to argue with propaganda, let us just make a few cursory remarks. With road construction in the PRC, which is unparalleled in the world, they have every right under the new economic policy to suspend some projects or even abandon them. Besides, we are talking about one of the underdeveloped provinces of China with a very difficult terrain, where road construction is difficult and extremely expensive. By the way, it is in this province that Kweichow Moutai, the manufacturer of China’s famous white alcohol, Maotai, has its headquarters. Western media as evidence of the crisis in China cite the massive sales of shares of this company, as a result of which their value fell sharply. At the same time, fellow journalists usually do not get to the root cause. And it is not in the general economic crisis, but in the local problems of the company, caused by the fall of interest in this cult and super-expensive drink in China. And this in turn is explained not by the shrinking wallets of citizens (real income growth this year will be about 7%), but by the policy of the Communist Party, which fights corruption and excesses. Maotai used to be an integral part of pompous banquets and used as expensive gifts. Now Maotai is under an unspoken ban.
By proclaiming a crisis in China, the Western media are killing several birds with one stone. For example, they are redirecting investors from the Chinese economy to the American one, hitting the image of their main enemy in China — the Communist Party — and singing the praises of Biden’s policy of “containing China”. At the same time, Democrats are disavowing criticism from Republicans and others who already accuse the White House of flirting with Beijing and moving away from a hard line. For example, China has deflated, so there is no danger in easing policy toward it.
However, the Western media are good in that it is impossible to shut out all voices that do not sound in unison. And as the «everything is gone in China» frenzy grows, there has been an increase in cautious publications calling for a correct assessment of the situation in China. This idea is also contained in an article published in a recent issue of the popular Newsweek magazine under the headline: «China was the world’s biggest economic miracle, and it will be again.» The article by David Goldman, deputy editor-in-chief of Asia Times and a fellow at the Claremont Institute in Washington, D.C., is at odds with the Western mainstream, which, in spreading the myth of the end of the Chinese miracle, usually tells us that China has supposedly exhausted the growth potential of cheap labor and that the systemic problems in the economy are so deep that they threaten to collapse. And so David Goldman writes: China doesn’t need cheap labor at all because it is «determined to lead the fourth industrial revolution.» «China is successfully building a new digital economy based on artificial intelligence and high-speed broadband, with 2.3 million of the world’s total 3 million 5G base stations, and download speeds twice as fast as the U.S. China has built automated ports that can unload a container ship in 45 minutes rather than the 48 hours required at our Port of Long Beach. It also has automated mines where no worker goes underground, factories run by artificial intelligence, and warehouses where robots do all the work, including sorting and packing.»
And if so, then cheap labor is really no longer needed. What is needed are highly qualified specialists, managers, and technologists. And as Goldman writes, China has them in the necessary quantities. «Nearly two-thirds of Chinese citizens now have a full secondary education, up from 3 percent who had one in 1979. China produces more engineers than the rest of the world combined, and Chinese universities teach to the highest global standards.» «China has also expanded its economic reach. It now exports more to the global South than to developed markets, doubling its exports to ASEAN and tripling its exports to Central Asia after 2020. It is building broadband, railroads and ports from Africa to South America, creating a permanent market for its exports,» Goldman continues about China’s development strategy. In fact, he describes the strategic maneuvering that the Chinese leadership is doing which is causing the growth rates that the West is so worried about to fall.
The author goes on to describe the real situation: «According to the World Bank, China’s real GDP per capita has risen from $404 in 1979, when Deng Xiaoping opened the economy to private enterprise, to $11,560 in 2022. It has jumped fivefold since 2001. In contrast, real GDP per capita in India has gone from $373 in 1979 to just $2,085 in 2022. Here is a comparison that vividly illustrates China’s unique economic miracle.»
What about the United States, the world’s technological, financial and economic leader? Another leading American magazine, The National Interest, writes about this in an article titled «Why America is losing the technology war with China». According to the magazine, «Biden’s restrictions on high-performance chips, software and the machines that produce them have not slowed China’s drive to dominate the Fourth Industrial Revolution — the application of artificial intelligence in manufacturing, mining, agriculture and logistics.»
At a time when U.S. companies are spending trillions of dollars to apply AI to consumer and entertainment applications, China is focusing on automating routine work. “China has become the first country in the world to allocate spectrum in the 6GHz band for 5G and 6G services to lay the foundation for advancing mobile communications and industrial developments in the country. These efforts have made China a global leader in the automotive industry in 2023.
The National Interest gives an example of Western companies losing out to competition. «Volkswagen, once the best-selling brand in China, has seen its annual sales drop to 3.2 million units in 2022 from 4.2 million before the pandemic. So the benefits of artificial intelligence are clear: cheaper industrial products, more efficient ports, deployment of automated vehicles, and so on.» And again, «U.S. restrictions on technology exports to China do not seem to have stopped or even slowed the deployment of AI applications that are of greatest strategic importance.»
The United States is not yet ready to see the obvious. Or they are afraid to talk about it and therefore write about China’s loss.
But Hungarian Prime Minister Viktor Orban bluntly stated that the United States is ceding its hegemony to China. «China has become an industrial center and is now overtaking America,» he said.
There are also publications of serious Western experts in responsible Western publications, who write that the United States, carried away by the «collapse of China», missed another maneuver of the Chinese leadership, which has long ago engaged in structural reorganization of the economy, reorienting it from exports to imports, abandoning rapid growth rates in favor of qualitative development and shifting the center of gravity to ultramodern industries.