Why China’s Local Government Debt Crisis Just Got Worse
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- čas přidán 5. 06. 2024
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Ever since China's rapid property boom in the 90s, local governments have been using lands as collateral to borrow loads of money. But various factors are now putting local governments under strain, and it doesn't appear to be getting any better any time soon.
Why China’s Debt Crisis is Quietly Getting Worse: • Why China’s Debt Crisi...
China's Local Government Debt Crisis Explained: • China's Local Governme...
The 3 Ways China’s Economic Crisis Could End: • The 3 Ways China’s Eco...
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1 - investors-corner.bnpparibas-a...
2 - www.wsj.com/articles/one-of-c...
3 - www.wsj.com/articles/one-of-c...
4 - en.wikipedia.org/wiki/Duge_Br...
5 - www.wsj.com/articles/one-of-c...
6 - www.ft.com/content/d91153fd-a...
7 - apnews.com/article/china-econ...
8 - www.ft.com/content/d91153fd-a...
9 - en.wikipedia.org/wiki/Provinc...
10 - www.ft.com/content/901bc68e-a...
11 - www.ft.com/content/901bc68e-a...
12 - www.ft.com/content/901bc68e-a...
00:00 - Introduction
01:16 - Disclaimer
01:33 - How GDP Works in China
02:25 - Local Government Debt Crisis Explained
04:31 - Why it’s Getting Worse
07:37 - Sponsored Content
If you dig holes and fill them in you're increasing GDP.
Yup, measuring an economy with GDP makes sense only for democratic countries. For autocratic ones, it's too easy to inflate those numbers that, as a result, will not show the real state of the economy.
During the great depression, FDR said it was better to bury money and make the public dig it out. At least then you get a hole.
Here in Ireland, the British made the west of Ireland build roads during the famine for food. What we ended up with is a money total pit where in the southwest we have almost a km of road per person. One of the densest road networks in Europe. I've 4 ways of driving to town all below a 7km drive starting from driving in totally different directions. There is nowhere else like that. It goes to show that sometimes it's better just to give the money away rather than build sh!t we don't need and then look after it forever..
Something missing... u mean one man dig hole .... then another man just fill them... but unrelated right?
Yeah that will increase gdp😅
i've been hearing "china's collapsing" since 1986
GDP means Great Depression Program or Gangster Declining Propaganda
You mean just telling people to "grow this much" every year doesn't magically allow them to come up with sustainable ways to do so?
The idea was to encourage the rapid approval of economic projects (cutting out red tape, streamlining the process etc) not "lol bridge is big"
Lol uk councils are going bankrupt
Communist China has always worked this way. Back under Mao, you could just replace GDP growth with farm crops yield, and you get the exact same thing. Emphasis on meeting unrealistical targets led to fake reports, corruption, and attempts at short-term growth projects that would be absolutely devastating to the local economy and environment in the long-term.
@@smalltime0And the idea behind the 1-child policy wasn't to create a demographic crisis.
Intents are irrelevant. Reality matters. Reality is BS infrastructure that costs taxes for maintenance and interest payments.
Chinese bots responded lol
Another point to make on the local government’s over reliance on infrastructure projects, is not just just that they don’t increase productivity, but that they can actually lower productivity due to maintenance costs. If you spend all your money maintaining bridges that no-one needs to use, you aren’t able to invest in other, more productive areas of the economy.
Id be honest i never even considered this
This is changing actually. China invested heavily into infrastructure in order to develop their then extremely poor nation. But now that China is sufficiently modernised, they've been cracking down on the infrastructure sector, most notably with the destruction of the real-estate bubble. I mean, why else did you think they didn't bail out Evergrande? Now China is investing in industry, particularly in the technological and green energy sectors.
Kinda like how the U.S. can’t maintain all their personal car road infrastructure and should invest in rail instead.
@@Honkious5824its too late. The hole is dug
@@Honkious5824ye they are changing they dont even care about the real estate company going belly up as they have the money to cover the damage. Just let those bubbles burst while we contain the damage and set up new policies new strategies that is more compatible with the future developements.😊😊😊
If China's real estate crisis triggers a market crash or a financial crisis, it could send shockwaves through the stock markets worldwide. I’m worried about my investment of over $600K stocks. Is this a time to consider diversifying my portfolios?
Bit sad when even TLDR gets spammed by the "awesome female financial advisor strangely with middle name" m+ron-fishing threads like this.....
Chinas economies are built on lies and fudged numbers. Fiat currency is finished. Buy gold and bitcoins :)
Chinese property sector, which accounts for 30% of GDP, is crashing.
- Exports and imports, accounting for 37% GDP, are down.
- Foreign investment (FDI) is falling over 90%, lowest in 3 decades.
- Foreign visitors are down 96% compared to the pre-pandemic level in 2019.
- Consumer prices are experiencing deflation.
- Youth unemployment hits over 21%, a record.
- Its fast-shrinking workforce is 10 years older than neighboring countries.
*Still, China keeps reporting outrageous GDP numbers.* Lol
Where does the growth come from?
They just make numbers up. Never trust an authoritarian regime
Never trust anything that CCP says
Employment of stasticians to make up the data
Government's always embellish their reports but Communists Governments are masters of BS and lies since their entire ideology is seperated from reality .
@wotermelon_ No people were not... Why is this comment exactly the same on every single video about China's economy, huh?
Would you say they’ve built a bridge too far? …. I’ll see myself out 😂
It's a nice drive at least. You just need to go on a road to nowhere
China creates so much infrastructure that it experiences economies of scale. they build metro lines at the cost of tram lines and roads and trains are 40% cheaper per kilometer than India . in the 2011-2019 period China built 10,000 km of toll roads and 2,500 km of high-speed trains every year
We can’t take your surrender; there’s no room…
The comment section is filled with strangely defensive and naive comments. Within 20 minutes already
It's quite odd, people can draw their own conclusions as to what the source of these comments are but I think it's pretty obvious.
Most likely Chinese bots
I see more western bots here than anything else.
@@cgt3704another fed bot detected.
@@silveriver9 You don't need to be western to be anti-China. Actually, the most anti-China people are all located outside the West.
There are three kinds of lies: lies, damned lies, and GDP.
Bruh
GDP is just another statistic, which can almost always be twisted to serve your own point
@@fly463China creates so much infrastructure that it experiences economies of scale. they build metro lines at the cost of tram lines and roads and trains are 40% cheaper per kilometer than India . in the 2011-2019 period China built 10,000 km of toll roads and 2,500 km of high-speed trains every year
@@carkawalakhatulistiwa Now the infrastructure is bleeding them dry
Financial planning is like navigation. If you know where you are and where you want to go, navigation isn't such a great problem. It's when you don't know the two points that it's difficult
People dont understand that the prices of things are never going back down. This inflation is deeper than we think. Those buying groceries are well aware that the real inflation is much over 10%. The increments dont match our income, yet certain investors still earn over $365,000 in stocks and assets. Wish I could accomplish that.
Very possible! especially at this moment. Profits can be made in many different ways, but such intricate transactions should only be handled by seasoned market professionals.
Some persons think inves'tin is all about buying stocks; I think going into the stock market without a good experience is a big risk, that's why I'm lucky to have seen someone like mr Brian.
Finding yourself a good broker is as same as finding a good wife, which you go less stress, you get just enough with so much little effort at things
Brian demonstrates an excellent understanding of market trends, making well informed decisions that leads to consistent profit
You're forgetting that if you abruptly stop construction projects, infrastructure projects especially those who have already started construction, this will cause a large ripple effect on the economy. Im not talking about its effect on china's gdp numbers but the construction downstream industry. For example, the steel and cement industry has already programmed future projects that would require more of their material some years ago, abruptly stopping them would cause problems with their liquidity and future loan payments. And what about the construction workers who relied on construction projects for their income. And other support industries who directly and indirectly rely on these projects. Result is many small businesses might close or go bankrupt. Even entire small communities will go bankrupt, unemployement will rise. And add all these up and you worsen deflation and not to mention social unrest
I can do you one bleaker. They're about to see a 5% per year contraction in their workforce size, thanks to an absolutely screwed demographic pyramid. The reality is the Chinese economy has one industry not automatically collapsing like a deck of cards and that's manufacturing. Which itself is reliant on provincial support/infrastructure/ cheap coal power etc. When they have to start taxing manufacturing to keep the economy from collapsing it's game over. China literally might have a gdp comparable to Russia's. Has their real economy is entirely based around manufacturing and that will circulantly shrink/collapse as all of the above start making chinese goods less competitive. That's of course ignoring that it's an open secret that the west wants china out of their supply chains, in addition to current supply chain issues at both the suez and panama's canals.
This is already happening for more than a year now.
Cement and construction materials industry is seeing huge contraction because of the real estate crisis. Many factories closed, many more are trying their best by cutting prices to the minimum, but destined to close nonetheless. I'd say that abandoned infrastructure projects won't be as much damaging.
Though they tend to abandon things abruptly and without warning or afterthought. So half-completed infrastructure may pose serious safety risks.
Still waiting for proof
When you reach a point where all your income is only enough to cover the interest rates, you're technically bankrupt...
well governments aren't
they instead borrow more money to pay for the money they've borrowed and then continue the cycle
so most rich countries are actually in infinite debt crisis and they're only stopping it with another debt
That only works as long as people believe in your country. China is set to have their workforce contract by 5% per year as their demographic pyramid is screwed. You add in disease/suicide/famine/emigration, and it might even be higher and faster. @@meow-ic6gz Nobody is lending money to china.
They hide and fake data on many many levels. But as the gap between reality and reported figures widen people start to lose faith in that the debts are ever services. Once this reaches a certain point of universal understanding there will be an avalanche effect of insolvency as every one of the entities are interdependently in a giant debt.
@@meow-ic6gz rich countries doesnt have debt service cost higher than their income at all... For the Federal State budget of the US its 16% quite far from 100%
@@Burito-tj5ry nah almost all rich countries have debt to finance their expenses
but most countries take debts to finance future projects
I love two countries, China and Tibet.
Greetings from the Japanese Senkaku Islands.
I don't think that love is reciprocal from China, Tibet might like Japan tho.
It's fascinating how this is both incredibly similar to the debt issue ravaging English local councils with the almost exact output - English councils basically went bankrupt investing in strange business deals or trying to cover costs for lawsuits they lost.
Removing the grant from central government, requiring them to maintain similar services and at the same time preventing them from raising local taxes at a high enough rate to cover the lost grant did that.
The lawsuits bankrupting services is egregious. The taxpayer needs to be protected from this. Law should make it impossible to sue councils and instead redirect litigation to the national government.
@@Tribuneoftheplebs if you think that deliberately underpaying staff because they are female, and the relevant unions getting that paid back is egregious, you are a bad person who should feel bad.
If you think that risking government money on several get rich quick schemes that failed is egregious, your right. Those responsible for such disasters as Brick by Brick in Croydon, Robin Hood Energy in Nottingham and the rest that filled out the back of Private Eye should be looking at defending themselves in court against charges of misfeasance in public office.
And that's before we get to the various IT disasters such as Birmingham's failed ERP system.
@@dwgray9000 So the children of tomorrow must starve and suffer because the women of yesterday got shafted? There isnt a pot of unlimited cash for everyone! Priorities have to be made and you are choosing those women over the children.
In 2023, real China's 🇨🇳 economy shrank -3.5% as opposed to 5.2% expansion as officially announced.
- So this year, they will just publish a 5% growth regardless of their economy.
Or they will actually hit it, but plunge themselves further into debt to do so.
Source?😂
@@pablosskates7067I believe this number more than the CCP's number.
Chinese GDP self identifys as 5.2% growth...😂😂
Link? Source? I thought not....
Can't feed your family with a new bridge
Irony is they technically are. As they use gdp growth as means to borrow the money needed to important goods.
did US build a new bridge?
@@mycodingchannel9690 Missing the point. Infrastructure for the sake of infrastructure does nothing except increase debt. Building infrastructure that meets economic need creates wealth.
@@recoil53 absolutely. Tell that to the US federal government who will spend its money to build a lane in an already 8 lane road for trucks, instead of moving towards railway infrastructure, most effective after ships.
@@mycodingchannel9690While I believe in more rail, it is defensible to build more lanes (and there are reasons not to). If there are 8 lanes and traffic jams, a lane can relieve congestion.
This is a very well put together and informative video. more like this.
So you’re telling me that China is like your one neighbor that keeps buying new cars even though he has no use for them and ended up in lots of debts.
I've always wondered, if local governments are paying for things but the taxes are going to the central government, what are those taxes going towards?
you didnt just miss the perfect opportunity to say this was a bridge too far??
Remember their GDP is 60% inflated so this is really MUCH worse
no their gdp 90% inflated
@@smallcube-zn2mm45.000 km high speed train is real
100！！
China 🇨🇳 has been a money-printing machine on overdrive.
During the years 1990-2021, the US printed 6.5 times more money while China printed 147 times.
- It has printed more money than the US and Japan combined, while its economy is only half of them.
- Current Chinese debt-to-gdp is already *highest in the world, at 300%,* according to Bloomberg.
- With stimulus and measures, China's debt will be at 400% to 500% of its GDP in the next decade, according to Reuters.
Woooo, Last Chang is here too
What’s the source for that 147 times money printed? Considering prices in China has been pretty stable and recently even deflation, it’s hard to believe
@@moonshadow7057The CCP didn’t give any of that printed money to regular consumers. It went to politically connected developers and construction companies to get turned into steel and concrete, bridges and rail lines to nowhere, and enough empty apartments to house an extra 1.5 billion people. Instead of driving a consumption boom, it drove the development and construction boom and massively inflated global raw commodity prices. You have to feel sorry for the ordinary Chinese who are going to end up facing the consequences of the overindulgence without even getting to enjoy the overindulgence.
Bull shit.
@@moonshadow7057That's why China's debt is 300%.
Great observation. I’ve been beating this drum since the start of the real estate crisis and glad to see others looking at it too.
The comment about China need to improve consumption is good in the abstract but not realistic given China’s demographic crisis. Old people don’t buy as much stuff.
old people is small part. That the banks will not let depositors have their money is bigger. But maybe these videos are skewed and we get a false picture. Who invests in 2 houses when they do not own one free and clear?
It's unrealistic because workers aren't getting paid enough to consume. China opened up to the world as a manufacturer with cheap labor. They've tried to keep it that way. With little excess income and with companies (many state owned) now unable to pay more, they cannot pivot to a consumer economy.
One of the best talks on the reason for the building Chinese debt crisis. Well done!
4:12 one might say china went *a bridge too far* 😎
It becomes somewhat of a circular argument to talk of Chinese debt as a percentage of GDP when (1) the number is a projection set at the beginning of the fiscal year and local governments are forced to (2) inflate the number and (3) the debt, itself, was used to inflate the original GDP in the first place. Frankly, why go through the process of getting a loan at all: Just write random numbers in the debit column and skip loans and interest altogether.
Cheat, steal, fake, fraud, corrupt.
the US?
U described usa
A bridge costing over 1 trillion yuan? I think you made an error there. That equates to more than US$140 billion for a single bridge.
He didnt make an error. Sadly.
They will report anything their party wants to hear.
The US GDP is 26 trillion dollars right now, china is 18 trillion dollars, but remember, china inflates its gdp every year, so its highly unlikely chinas gdp number is that high.
The nominal wouldn't really matter as a Surplus balance Exporters. China was typically importing the deflationary economy to the West. Until the pandemic hit.
yes china can legally inflate every daya at their will without facing any regulation backlash
like their national debt data it's low in paper but the real data was actually in the real estate market
companies list their real estates to be the collateral for a loan and china is taking trillions with it so the national debt data is secretly hiding in their real estate sector
yet US doesnt have a single HSR. where does the GDP come from?
The US GDP is also laughably inflated.
As an example, the same sick person who increases the GDP of Denmark by 200 bucks due to the medication they need could easily increase the US GDP by 1000 bucks instead, simply because the poorly designed US Healthcare system is so incredibly inefficient.
There is a reason why the GDP is not considered a reliable metric to measure an economy by experts.
I would not doubt that China’s GDP is actually smaller than both Germany and Japan’s.
So basically most of there GDP is just borrow and spend 😑
not just china but usa
they need to spend more than they makes so they borrow money and because the interest is too high they've also borrow more money to pay the other debts their own thus increasing their debts
India best achievements so far
India's Hunger index
2013: 63rd rank
2022: 107th rank
India's Happiness index.
2013: 111th rank
2022: 136th rank
India's press freedom rank
2013:79th
2022: 150the the fourth pillar of worlds largest
democracy is no more
India's unemployment rate
2013:4.9%
2023:7.5%
Unemployment rate never increase in growing
economy.. india is growing only on paper and by
loan
India's Debt
before 2014: ₹55 lakh crore
2023: ₹155 lakh crore
India's GDP from 2004 to 2014:
$709 billion to 2.04 trilion (almost triple)
India's GDP from 2014to 2024:
$2.04 trillion to 3.6 trilion (expected)...not even
double
@@user-xp7nk9dw8d GDP in 2024 is 4.11 trillion bro
Its more than double even after covid lockdowns for 2 years and global slowdown
@@user-xp7nk9dw8d if india followed the same model as china your country would be rich af
@@user-xp7nk9dw8d why do pakistanis care ? Dont u have your own economic troubles to deal with?
Here's the thing about saying that some of these provinces have over 100% debt to GDP, that's using GDP figures that include those useless infrastructure projects that got them into this mess in the first place. So probably more than 50% of the GDP of these provinces are filled with things that don't actually increase their productivity but actually decrease them due to maintenance costs. In other words, their actual GDP is much lower than this and so their debt is an even bigger problem.
China creates so much infrastructure that it experiences economies of scale. they build metro lines at the cost of tram lines and roads and trains are 40% cheaper per kilometer than India . in the 2011-2019 period China built 10,000 km of toll roads and 2,500 km of high-speed trains every year
@@carkawalakhatulistiwaGetting expensive, but ultimately useless things cheaper than others because you buy so much of them *does not* help the economy
That's why usa is under chinese debt of 20 trilion
China is not in usa debt
China needs a new leadership willing to focus on economic and social well-being.
Its seems Xi's ironfisted consolidation of power has destroyed the efficiency of Chinese bureaucracy and decision making.
This is totally unrelated to the video, but your books in the background resting against the lightbulb is insane. Get a set of bookends lol.
Ironically enough Guizhou's name means honorable/rich province.
Well, it's not just a consumer economy that would fix their problem. A war economy would, as well.
Infrastructure isn’t about productivity for whether it’s viable, it’s about profitability
Good video. Guanzhou is closer to 500% debt to taxable revenue by numbers reported by China Observer. The whole of Chinese local debt is more the US federal debt so that should tell you how bad this actually is with 1/10th the total tax revenue.
China observer is one of the least reliable sources there is😂 they've been repeating the "china will collapse in 6 months trust me bro" nonsense for years
sad part is all tax revenue would go straight into beijing no matter what region province or city it is
the only way provinces can make money is by raising debts which would add up to the GDP thus increasing the annual data but is doomed to fail in reality
@@Fred_the_1996 The thing is, if they had collapsed like 10 years ago, they'd have been much better off. No really. People have been saying they're gonna collapse for years because, well, those problems have existed for years. But 10 years ago if they had just stopped the GDP growth targets and tried to solve the crisis immediately, they would have gone through it. It would have been a crash similar to the USA 2008 financial crisis but China would have recovered no problem. If China had instead tried to solve the crisis just before the lockdowns, they once again would have gone through it. It would have been much worse, probably an economic downturn similar to Japan's decades of stagnation but it wouldn't have meant the ''end of China'' or whatever. But now it's way too late. If all of your revenue is going to pay just the interest on your debt, you're technically already bankrupt. They're gonna see an economic crisis like the world has never seen before because they just kept ignoring the problem for too long.
As an anecdote. I can say guizhou is very poor. It' was so obvious when I set off the plane .funny thing is ,they stiko build shit . The tallest building in the city is half empty 😂. Me an a friend took the elevator up it last 2 years ago, 30 floor is were empty, and not built but from the outside it looks finished.
@@Fred_the_1996 They are just as reliable in reporting as these left wing socialist idiots.
Neat
You can never sustain lies.
Agreed . That's why this video aged like milk
It's important to note spending, not income(as one would assume), makes GDP rise; thus government is incentivized to spend(& borrow) to increase their jurisdiction's GDP figures.
The chinese demographic collapse was always going to spell doom for the housing bubble. Now it's spells doom for infrastructure maintenance, It's GDP and bridges will collapse.
Then why is korea japan uk facing demographic collapse?
It's really a government mismanagement problem. If Chinese government do not improve on how they deploy their resources, then there will be no end to the economic crisis.
It's impossible if you both want to control the society and reaources, and keep an innovative and open market at the same time.
You need Gordon Chang for this.
Not to be that guy, but to put it simply it is pronounced: gwei-jo
It is pointless but it was funny how he pronounced it 5 different ways
Guizhou is pronounced "Gway Joe". Is there a Brilliant course on pronouncing Chinese pinyin? 🙂
Tofu government
Better than yankee govt
Bottom line, China has several interrelated economic and political issues: debt, corruption, a declining and aging population, deflation, youth unemployment, de-globalization, and a wide array of nations actively orienting in opposition. There might be solutions to any one of these problems, but it will be very difficult to resolve them all in the short- to mid-term, and and the long-term demographic trends will
manifest.
That's usa
Doing it on a such big scale might mitigate negative consequences. The Question is who is the money owed to and are they in a position to enforce repayment. If that is not the case the question is only do want the workforce to be idle or create new infrastructure.
Been crashing since 1976 😂
czcams.com/video/ut5NBseX8_c/video.htmlsi=JKtNTfWwogtSF_c8
Now you know why Xi spends all that money on Pro pa gan da 😂😂🤣🤣🤣🤣
Well I see your work for free
WASHINGTON (Reuters) - Two years into office, President Donald Trump authorised the Central Intelligence Agency to launch a clandestine campaign on Chinese social media aimed at turning public opinion in China against its government, according to former US officials with direct knowledge of the highly classified operation.
Three former officials told Reuters that the CIA created a small team of operatives who used bogus internet identities to spread negative narratives about Xi Jinping’s government while leaking disparaging intelligence to overseas news outlets. The effort, which began in 2019, has not been previously reported.
Local councils all over the world are often in debt but strangely continues on regardless.
Because that debt is virtual, as long as it is in national currency you just create more money. The only down side is inflation. Argentina is the perfect example, inflation is ridiculous but life goes on. Their trouble starts only when they can't pay for their import with their exports, that is when they have to borrow foreign currency from other countries.
Couldn't be worse than 33 trillion debt
local council in the UK do the same thing and are in debt to the point of collapse
the local councils have to admit bankruptcy and act accordingly. those in the middle kingdom, on the other hand...
Aside from the previous reply, which is spot on, the way that local governments raise money in China is different to how council tax works.
Local governments in China rely on land taxes which are largely determined by speculating on future growth. In many cases, the local governments are reliant on continued growth to ensure local investments can be paid for. If there’s a contraction and confidence is lost in a region, it will kneecap the ability to raise revenue and the collapse will be drastic unless central government steps in to restore trust.
In the uk, the debt of councils is generally much easier to sort out. There can be impacts for raising council tax of course, but it’s relatively easy to restructuring restructure debt than to restructure it and build business confidence to pre-contraction levels in a short period of time.
Who's gonna buy Chinese bonds...!? 😂
And there's the rub. My guess is that the CCP will try to get the average Chinese to invest in bonds rather than real estate. Problem is, a piece of paper isn't as attractive as a whole house. They'll need a big propaganda push to just move the needle.
I suspect a lot of bank depositors in China will find that their money has been "invested" without their permission. That is why banks make it almost impossible for them to withdraw money.@@Toonrick12
Everyone did . China refused to sell any to usa though
China has 0 foreign debt
Uk has 20% debt to China
Usa has 24% debt to china
@@user-xp7nk9dw8d Well that's good news. So no Americans will get shafted when they default on them.
@@YourHineyness do try that . Usa won't get shafted
Just taken over
Restructuring is not bailing out.
No bridge costs 1 trillion yuan - that figure must be a mistake. Even the extraordinarily expensive HK-Zhuhai-Macau bridge was only around 140 billion yuan.
You're forgetting all of the under-the-table payouts. For every project, 3/4 goes to corruption, 1/4 to project.
Only in your imagination @@YourHineyness
So now west decides which part of Chinese investment is necessary or not? You feel the infrastructure in less populated west is unnecessary? How do the west play the human rights ball then? In fact, the west fears the belt&road initiative, which is to connect from east to west all the way to Europe, with advanced rails and high-class roads. Not GDP-wise or not approved by west? In fact why worry about Chinese GDP crisis? Is n't a good thing to you?!
The use figures and expenses are the judge, not 'the west'. Not every project is a waste obviously, but there are many high speed trains in China that just lose money, and unless a LOT more people use them, they will never pay off themselves.
This type of tongue was originated from political media a while ago. This TLDR is either brain washed or funded. You will see more and more gradually. A new media campaign against China, but never works...@@monkeeseemonkeedoo3745
@@monkeeseemonkeedoo3745 In general, it is true to rely on "figures and expenses", but there are so many figures to look at, no one knows which one to look at without a long time scale. You have to look at the data for a much longer time period, which doesn't exist. If Wall street style figures tell the truth, then why the economic system is failing? China sabotage? China gets advanced by black magic? In western China collapses every week since year 2020 I guess, due to the figures you mentioned. High speed train debt is surely one of them, it is a cliche, not data science.
@@tildarusso I think the idea was 'build it and they will come', and that worked really well sometimes, especially at first.
Maybe in a long enough time frame it works out to be profitable, but to give a concrete example, one issue I've heard about is that currently, the China state rail group is very indebted (almost a trillion dollars) and not profitable. While it is brought up a lot, to me it paints the picture of a government that 'invests' in wasteful ways.
Personally, I think the 'health' of China is an average of all that goes on within it, including for example the property sector, railways, banking, etc. It's hard to say whether 'China will collapse', whatever that might mean. Still, the major trend that has people talking so much is that China is not doing as well as before, and that's a major understatement, with confidence shaken both in China and outside of China.
And those building is build with shit quality
Don't talk about quality control anymore with Boeing planes shitting themselves
@@J_X999 classic whataboutism, also im not American and yes Boeing quality control sucks ass. So what are you gonna do about it little pink?
@@J_X999boeing is a private company and isnt linked to the us state what is your point?
@@anesupasipanodya Yeah, and most of China's infrastructure is also built by private companies. Duhhh??
@@J_X999 By Chinese standards Boeing would be still consider as following procedures and being highly merciful for whistleblowers...
A surprisingly good take on China, although a bit outdated. Good job tldr
I like how you pronounced Guizhou differently every single time you said it.
I always find China to be such a contradiction. “In this great communist system all the people will prosper and property will be held by all people”. (No national healthcare or retirement and in a debt crisis)
They like the aesthetics of Mao, the governments of the Soviet Union and Fascist Italy, and the philosophy of Ayn Rand. The glorious people's revolution is all well and good, but the party and the oligarchs rule all, and among those it's everyone for themselves.
At least one source reported that communist China has a more inequitable distribution of income than does Capitalist Europe.
(though a more equitable distribution of income than has the United States)
So much for "From each according to their abilities. To each according to their needs".
@@feihceht656awwww
China 0 recession
China 0 inflation
Usa recession
Uk recession
France recession
Germany recessing
India recession
Taiwan recession
Question: if we know the CCP GDP figures are 'fudged', why do they impress the international markets?
Based on direction of the flows, capital seems to be recently somewhat unimpressed...
Easy . Bcz they aren't . It's a lie peddled
Nothing new
Remember uyghur genocide claim . 😂😂😂😂
When "one more bridge" is a bridge too far...
Is there a better way to measure economy than the gdp?
Good, good
Found u
Weren't u simping for israel lol
Even israel begs China
I've been hearing "china's collapsing" since 1986
Are you from sideways norway
Been hearing of the USA's collapse for just as long... So far, the only collapse is the Soviet Union (arguably the dumbest).
China is a member of WTO since 2001, its since then its reporting outstanding growth. It might have colapsed if it was not for Clinton and pseudo liberals, who let them join the "globalisation". But hey at least for the past decade or two we have some cheap comoddities/merchandise XD
No, I heard the same thing. But you're conflating the CCP with China's economy. Back in the 80s, the people saying China would fall, were the same ones saying the Berlin wall would fall, the Iron Curtain would come down, and Soviet Union would collapse because they were referring to Communism.
You can't deny demographics and China's demographics are fatal. They're becoming a country of old people and old people cannot sustain a robust burgeoning economy. Labor costs have skyrocket and deflation is becoming the norm.
All I’ve been hearing is “CHINA WILL TAKE OVET THE WORLD!!!! GDP WILL BE BIGGER THAN THE US IN 2 WEEKS!”
4:11 Sounds fake. And it looks like the Duge Bridge.
Couldn't they just stop setting a target for GDP growth, or atleast lower that target significantly?
When it is a slow day at the office, you resort back to this topic to get more views 😂
I hope Winnie pays you in proper currency and not Yuan for these comments.
@thedutchfoxxx A schilling has been deposited into your acc. Shill harder, hopefully one day you will make enough schillings to retire to Luton.
So, my main question after this is, if all of the CCP's government entities are spending so much on servicing loans, who are they paying these fees to? Local Chinese? Foreign countries?
Well. Actually this video is globally fake news. The debts is just getting similar with western countries.... As the economy. Nothing as impressive as what they say
A lot of the LGFVs operated through real estate. As such to some degree this is the same debt crisis as the real estate crisis, the money was typically borrowed against land leases (we’re just now seeing more of the debt). As such for the residential sector, the cash largely originates from Chinese homebuyers but also investors. There’s also all the commercial real estate and businesses which often used subsidized land to set up operations. Accounting for internal competition these are likely net productive. However, a lot of them have business models which rely partly on suppressing workers’ wages for export market competitiveness. In some sense you could say the workers have supplied the debt, but they’re not owed anything on paper. In the end though this is all called shadow banking for a reason which is that none of this is really transparent. It could be owed to someone completely different and it would be difficult to determine. In the real estate sector a large fraction of the debt became deferred contract payments, wages, etc. ultimately unpaid. With the cutback occurring to social programs and other outlays it’s possible something similar is effectively occurring with the government debt.
@@thekonkoeNicely explained. And the non-transparency needs to be underlined. That is going to make fixing the system much, much harder.
@@thekonkoe too many words. Simply put like this, they lend the lands to those who wants to invest so they can set up infrastructure like apartments, factories, shops anything that create economic value on their own. Meanwhile the government use the money obtained to develop infrastructure connecting and enabling the said invesments like roads, utilities services, public spending,...... In the end those region will be fully developed, having a working population that lives and provides spending, production for those regions itself. Of course people would have to work if they want to have a bigger street or they want to look modern, the people paid for it when they are working for the corps invested in those areas. But on the other hand they get all the rewards from the utilities to the house and employments it brings forth. Nothing shadowy it is just someone wants to make it look mysterious and thus "supposedly illegal" to discredit China 😂😂
@@thekonkoeAnd about the surpressing worker wages well check out Nike sweatshops 😂😂 that is the real example of labor abuse😢😢
Local government borrowing from local state owned bank.
Chinese look at development investment as public good , not an investment expecting returns.
A thing often looked over in these types of videos is that infrastructure that may not be ideal for GDP can still be incredibly valuable to a population, who gains access to it at affordable rates. For China as a socialist government may be valuing other factors the just gdp when building things. This comes to mind particularly with high speed rail comnections that cant pay for themselves, but keep their population connected and from feeling left behind. Not that it garentee's the project is worth the money, but is another factor we in the west often undervalue.
"This comes to mind particularly with high speed rail comnections that cant pay for themselves, but keep their population connected and from feeling left behind." And convinced that just in case of them showing any discontent bringing army would be very easy from logistic standpoint...
I agree that there are significant non-economic goals to be achieved, just a bit sinister ones...
Nah the purpose of overall development should encompass all of the nations even the poorest of region that is why you see some region looks like defaulting but in reality it is just government trying to invest infrastructure in a low income area
The US Interstate Highway system was not built so that Americans could feel connected. It was built so that troops and equipment could be rapidly transported to the West Coast in case of invasion. I suspect China is doing the same thing: building a network of rapid deployment facilities for their army in case of civil unrest/revolution. If the public happens to benefit from it that's just coincidence.@@useodyseeorbitchute9450
I live in China. Everything is miserable here, but no one dares to complain.
For one thing, I am young and unemployed. As a result of the One-Child Policy, I may be the last generation of my family.
Seriously if there is next life, I wish to be born in any other country, except China.
Even Somalia?
@indetermite at least they have family and friends who are close, besides hunger it's not the worse
Are you a cia bot?
@@kagnetix6674 gadam.
@@ludicrousreality08964
The Debt giventh, and the debt takenth.
iMAGINE HAVING a government that's so competent they build infrastructure which\ is " too good"
China had really good infrastructure for a while. Since about 2008 many of their investments have been for gdp growth's sake, not because they are useful investments. That is not competence, and it's why many infrastructure projects are an economic drain for China
The Financial Times have been predicting China's impending economic collapse for the last 30 years 😂
Demographics is destiny. China is becoming a country of old people thanks to Chairman Mao's One Child Only Policy and the current culture of the Chinese not having any children. A robust growing economy is simply not sustainable when you're a country of old people.
@@smithb0134 That's the case all across Asia lol
@@djsapien3448yeah but the way China went about it means it will be an abrupt collapse rather than a slow decline
Now do a video on their demographics crisis
yes
In 2022 52% of new industrial robot installation is in China. And soon China will industrialize the production of babies.
Didn’t they do that
How about do a video about UK's economic and immigration crisis. Oops doesn't fit the narrative 😂
@@silveriver9they usually do mention those on the other channel TLDR News (UK)
Finally I breath of fresh air 😅
And now u are suffocating since china economy grew again
Imagine you suffer from a good infrastructure
Cope all you can, the Chinese century is here.
Sure, Wumao. 😅
@@diogorodrigues747 its facts
@@xilunjiang317 Sure, another Wumao. China as it is right now isn't going to surpass the US anytime soon.
@@diogorodrigues747 why are you so paranoid about the fact that china might surpass the US? it shows a lot of insecurity
@@xilunjiang317 I'm not minimaly paranoid, I'm not even an American. I'm just saying facts, given the current context China won't surpass the US anytime soon. No actual independent economic expert expects that to happen right now.
Indian channel? 😂
All bullshit. My Chinese frens are staying out. They can leave China anytime but they are not.
no
8964
@@freeman10000 91101
British Channel
Excellent review of China’s self induced dilemma!
They don't have good infrastructure, they have way too much instructure. Which is low quality because it is a shell.
Much Infrastructure Project = Much Debt Problems! To much infrastrucure project causes problems! 3% GDP Growth is better!
infrastructure is great and serves productivity -- provided it's actually used!
real estate market is actually good for their economy
it increases the tax revenue whilst the infrastructures are being built
then after it was built they'll list the properties to be a collateral for a million dollar loan
so real estate is actually a trillion dollar loophole for xi jinpoop
If theres nothing to report you can always rely on a chinese financial crisis videos or the worlds demographic crisis
Central gov: All taxes are mine
Central gov: You need to grow by 5%
Local gov: lol right
China gdp is $12 (after bills)
When you have a monetarily soverign national government, local government can always be bailed out. Most US cities would go bankrupt too if not for federal spending (since US cities only allow single family home in most areas which is terrible for city finances)
The difference is that chinese provinces are completely responsible for their services whereas in the US, states usually just pay half. Beijing extracts most of the money and gives very little in return.
@@Hideyoshi1991precisely, you nailed it 👍🏻
@@Hideyoshi1991 that can change at any time
Since the national government can't go bankrupt, local govenrment doesn't have anything to worry about.
100% GDP should be a fatal amount of debt. You reach technical bankruptcy before you even get to 100% when you add in the interest and yet European countries also have this level of debt and don't plan to stop borrowing. It can never be paid back because now you have to borrow in order meet the payments and you get into a death spiral from which you can never emerge.
Its good to know that our rival is making all of our mistakes
They can just be bailed out by the government
That costs money
Better than a bailout corporation or stock market.
@@davidescristofaros2241 Good thing the chinese government has an infinite supply of yuan
It can't JUST be done, it has a cost. Whether it is bearable for the budget, etc etc is the question.
is that simple? 🤣
Sell more dog meat!
I know this is a joke, but it doesn't matter if they sell more when people won't buy. Hence deflation.
I did NOT know that the provinces are sending most (or was it all? I'm tired and not paying attention so good) of their taxes to Beijing and can't keep that for themselves. How come China made that decision? Is the idea that like... the money won't be gathered by the local bigwigs but managed by the supreme leaders who will fairly and without bias distribute the wealth? Or is that just my first guess because that's what my limited view of China and it's mindset says it could probably be?
China is land , a country containing the CCP and citizens. The CCP is the school yard bully taking part of the citizens/students lunch money. The CCP does little else except hire police for enforcement.
In theory, this is indeed the fairer way. For example, a province might be focus on producing agriculture products, which is not as profitable as for example shanghai, financial capital of China. However, stock prices going up, while profitable, is useless if the country does not have food security and 1.4 billion people goes hungry.
The Chinese stock market is so volatile right now. The growth does not make sense when so many businesses are leaving. The market is likely being artifically proped up to try to avoid complete collapse.
China is doing very well with its exports which climbed to 7.1% in January and February 2024. On the other hand, UK, the Sick Man of Europe, has been building a coffin to lay into because its economy has totally collapsed 😅🤣😂🤣😅😆😆🤣🤣😂🤣🤣😂😍🤪😜😝😝
steel exports were through the roof as tens of millions starved during the great leap forward.
So that means everything (goods and services) in the UK is debt! But the fact is that they are busy to destroying Chinese and Russian economy.
🇺🇸
China will falllllllllllllllll
fed bot with low bandwidth decided to post a short comment instead of saying China will fall like last time
It will be fine. If the numbers don’t look good then they just won’t publish them, like the youth unemployment numbers. Problem solved.
4:15 "China has built more than a thousand bridges. But, this is just too many bridges." Well said