One of the predictions I made in 2023 is that China's economy would be in trouble and it could cause civil unrest. I think I got the first part right but the civil unrest part is a bit hard to judge since China heavily censored the news. China also has an Orwellian style citizen surveillance program so any protest will probably be quickly squashed. Anyway, it’s undeniable China’s post-Covid recovery was underwhelming. Youth unemployment rate went from 17% when I wrote the prediction article to 21.3% in June 2023 and the Chinese government decided to stop publishing the statistics shortly after.
China’s real estate bubble has burst and the home prices are set to deflate if not crash. The country has a lot of leverage in its banking system. Chinese property giant Evergrande officially filed for bankruptcy in August. Another property giant Country Garden defaulted on its loans in October. Chinese CPI actually went down 0.5% YoY in November. Many experts believe China is going through a deleveraging process similar to Japan’s lost decades. It’s unclear if the economic challenges will bring political upheaval. It appears that the optimism for China’s economic growth and world domination has been lost and I don’t see things turning around any time soon.