Is China’s Economy About to Implode?

China will introduce economic reforms to deal with “risks and hidden dangers” the Politburo said last month. China’s Central Committee will hold its economic-focused Third Plenary Session in July—outside its regular schedule—probably to announce these changes.

China’s economy is struggling.

• In April, government adviser Liu Yuanchun warned about supply-demand imbalances and a rapid deterioration of local government debt.
• The International Monetary Fund reported that China’s debt reached 88.6 percent of gross domestic product at the beginning of this year, a 47 percent rise from 2019.
• China’s rapidly shrinking population means it no longer has enough people under 45 years old to prompt a consumption-led economic recovery.
• New residential developments in China plummeted 58 percent from 2019 to 2023, prompting the government to announce a radical plan to spend $280 billion per year for the next five years to purchase distressed private residential properties.

Growth problems: It is rare for Chinese officials to openly discuss financial woes. These acknowledgements and plans indicate the severity of the problems.

The Chinese Communist Party says the economic changes it is considering will result in more modest growth with the intent to negate “risks and hidden dangers.” But the Chinese economy may have already stopped growing. Either way, China’s economic problems are likely too profound for superficial reforms to fix.

Prophecy says: The Bible prophesies that Russia and China will soon lead the most powerful military alliance in history, and Russia will be the greater of the two. A Chinese economic downturn could help secure Russia in its prophesied top position.

Learn more: Read “Will China’s Coronavirus Make Vladimir Putin ‘King of the East’?”