China’s economy is slowing, its population aging. That could make it dangerous
S E E D E D C O N T E N T
China’s economy is in trouble. The juggernaut that once looked bound for global domination is slowing down — and not only in the short run.
The Chinese economy’s projected growth this year has slowed to about 3%, missing the government’s target of 5.5% by an embarrassingly wide margin.
After decades of galloping expansion, that would be the second-worst performance in more than 40 years. Only 2020, with its COVID-induced recession, was worse.
Unemployment among young workers has ballooned to 20%. Fuel prices are rising thanks to Russia’s war in Ukraine. The overbuilt housing industry is teetering. And President Xi Jinping’s draconian “COVID Zero” lockdowns have created havoc, most recently in technology-heavy Chengdu (population 21 million).
Remember when Americans fretted about China overtaking the United States to claim the title of world’s largest economy? That date has been postponed to 2033 or later, and a few economists suggest it might not happen at all.
Some of those problems may be short term, driven by a slowing global economy and Xi’s refusal to import foreign COVID vaccines.
But China also faces long-term challenges that won’t go away, beginning with an onrushing demographic decline.
The United Nations projects that China’s population will shrink roughly 40% by the end of the century, from 1.4 billion to a mere 800 million or so. Some demographers say the decline will be steeper; either way, India will soon take over as No. 1.
The population decline stems from a low birthrate, which also means China’s population is aging and its workforce shrinking. By 2050, more than a quarter of the population will be older than 65, Australia’s Lowy Institute projects. Lowy expects China’s growth rate to slow to an average of less than 3% over the next three decades as a result.
China-watchers agree on those doleful forecasts. They disagree, though, on what that means for the country’s future and for U.S. policy. How does a rising superpower react when the foundations of its strength appear to be eroding?
Two foreign policy scholars, Hal Brands of Johns Hopkins and Michael Beckley of Tufts, have offered a frightening thesis: China’s leaders know their power is about to diminish, and that will make them more likely to take risks in the short run — to invade Taiwan, for example.
China “is losing confidence that time is on its side,” they write in a recent book, “Danger Zone: The Coming Conflict With China.”
“China will have strong incentives to use force against its neighbors … even at risk of war with the United States,” they warn. The “moment of maximum danger,” they suggest, is this decade: the 2020s.
A chorus of other China scholars have disagreed.
First, they note, there’s no evidence that Xi or other leaders believe their power is declining; they continue to predict the rise of China and the decline of the West.
Even if China’s economy slows down, it will be growing — still the second-largest in the world.
“Countries can muddle along with a great deal of poor economic performance and still be a major force in international politics,” noted Aaron L. Friedberg of Princeton, author of “Getting China Wrong.”
Besides, Xi and other Chinese leaders have a strategy for solving their economic challenge, he argued. “They see advances in technology as the key to solving all their problems,” he told me. “That’s how they plan to achieve higher productivity and reasonably high economic growth.”
“We have to do more … to slow down China’s technological development,” he said, beginning with tighter controls on the export to Beijing of U.S. and other Western technology.
A rosier scenario, Friedberg and others noted, is that a slowing economy could induce China’s leaders to devote less spending to military strength and more to improving the lives of the Chinese people.
“We should not assume that a weaker China would be aggressive,” Bonnie S. Glaser of the German Marshall Fund argued. “China could turn inward. Maybe China isn’t as intent on unification with Taiwan as it is on internal stability.”
So the 21st century may not be Chinese after all. China’s rise to global power is neither inevitable nor foreordained.
But even an aging China with a slow-growing economy will be a powerful commercial, technological and military competitor. At least until the end of Xi’s third term in 2027, its leaders will still be ambitious, still bent on absorbing Taiwan, still intent on supplanting the United States as the dominant power in Asia.
China’s challenge is changing its shape, but it isn’t going away.
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It looks like this may be the decade of maximum danger from China, as they may try to maximize their aggressiveness before their population decline saps their power.
Tying themselves to Putin was a major misstep, hopefully they take the time to recalibrate.
Did China tie themselves to Putin, or was it Russia?
China is making out like a bandit on their deal with Russia.
Even if Putin is removed from power Russia will be facing the consequences of it's invasion of Ukraine by the west. Trade will not snap back to normal- not even sure the next Russian leader will want it to; if they continue with their non pro West hard line succession. The China treaties are the perfect outlets for Russian oil, natural resources, and food. Russia might double down with China to really screw the west over.
This essay explores the topic in a little greater depth:
” What the United States will face in this decade, then, is a China whose ability to batter its enemies and challenge the global order is growing, even as leaner economic times loom ahead.
This China is unlikely to be benign or peaceful. History has seen many once ascendant countries lash out violently rather than accept a disappointing future as a second-tier power. This fear is what led Germany to take the risks that helped ignite World War I. It prompted Japan to undertake the expansionist rampage that helped bring on World War II.
Many theories, none are definitive, but for the time being China is a pretty good place to live. If I wanted to move to the USA, I would want to purchase body armour, guns and ammunition for self preservation, and have to live on welfare rather than very comfortably as I am able to do now on my Canadian and Ontario government pensions. However, I really put no credence in the paranoid dystopian theories of some in the seed.
You make it sound like the US is just a totally bad place to live, but it's not all bad. The majority of the problems are in some large metropolitan areas and their adjoining suburbs. It is out in the rural area smaller communities that are fairly safe for the most part.
I appreciate what you're saying Ed, but I'm happier being somewhere where people don't have guns than being somewhere where I would be "fairly" safe "for the most part". I used to LOVE the USA. I've travelled through so much of it and even owned a home in Florida. What happened?
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I said "fairly safe" and "for the most part" for a reason as there is no such thing as completely safe. One is fairly safe crossing a street but can still get hit by a car or fall off a curb. I still love the USA. It is my country right or wrong. I once took a solemn oath to serve and defend my country and uphold it's Constitution against all enemies foreign and domestic. Nobody has ever relieved me of said oath. Sorry, did not mean to get on a soap box there.
If I were to decide to move to the USA I'll try to live near you, rather than in a big city.
I think you would probably like it. We get a lot of out of state and foreign expats who come to visit and wind up putting down roots and staying. But it is not for everybody. Many do not like the semi isolation.
Half a century ago I almost bought and moved to a farm in a very remote area of Ontario, tut now at my age and physical condition it's better that I be close to the kinds of services I require, and being in a big city is a necessity.
I understand. The closest big city to me is Tucson, AZ, which is two hours away and a smaller city with similar services is Sierra Vista, AZ about an hour away. In my case that is still close enough when needed.
a slowing global economy
Oh, it's not all Biden's fault...
Brandon is exasperating the slowing global economy- along with cooking inflation and fuel prices.
Strategic oil reserve is the lowest it has ever been. How much longer before the US government has to buy back with the price of oil over $100 a barrel. What will happen to the price of gas then?
Of course not, a booming economy is always to the credit of the President in power to his supporters and a slowing economy is always due to external factors.