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Since 2012, when Xi Jinping (Jinping Xi if you write the family name after the given name) assumed power in China, the Communist Party has increased its presence and interference in every aspect of Chinese society. The media are no longer allowed to criticize any aspect of China's life. Censorship is rampant on social media. All Western social media are carefully banned. Increasingly, it is also difficult for VPNs to get through China's "Great Firewall".
During the 18th National Congress of the Communist Party of China in 2012 both departing president Hu Jintao and newly appointed president Xi mentioned corruption as an existential threat to the Communist Party. In January 2013 Xi, speaking at the Central Commission for Discipline Inspection (CCDI), asked for the cleansing of "tigers and flies", i.e. of corrupt officials.
At the time, Xi's anti-corruption campaign was widely perceived in China as having the secondary objective of removing Xi's enemies. Tsinghua University political scientist Wu Qiang told the Guardian that anti-corruption campaigns were being used to conceal political struggles inside the Communist Party.
In reality, the anti-corruption campaign had started a few months earlier. Zhijun Liu, also know as "Great Leap Liu", had been promoted Minister of Railways in March 2003 with the mandate to build thousands of kms of modern high-speed railroads, but he had turned his ministry into a state within a state, funding it with graft. The Ministry of Railways had become the second most powerful ministry in China, second only to the People's Liberation Army. In February 2011 Liu was fired over allegations of corruption and the state media began a campaign to discredit him. The state-run Global Times even accused him of maintaining 18 mistresses (not bad for a 58-year-old man). In April 2013 Liu was arrested and has been in prison since, and the Ministry of Raiways was dismantled, leading to the creation of the state-owned China Railway corporation (At the trial Liu read the usual confession, and the prosecutors reported that "Liu had a very good attitude in confession and a strong desire to repent," according to China's news agency Xinhua). Liu's mistake may have been to try to bribe his way into the Communist Party's central committee. The Communist Party reminded him and everybody else that the Communist Party is off-limits from outside influence.
Since then, the Communist Party has purged Xi's rival Bo Xilai, security chief Zhou Yongkang as well as three close associates of Zhou Yongkang (Ji Wenlin, deputy governor of Hainan, Li Dongsheng, deputy minister of public security, and Chuncheng Li), the director of the General Office of the Communist Party (Ling Jihua), former Kunming party boss Zhang Tianxin, Guangzhou's mayor Qingliang Wan, Xu Caihou, former vice-chairman of the central military commission (the most prominent military figure to be purged in decades), two party chiefs of Yunnan, namely Bai Enpei (arrested in 2011) and then his successor Qin Guangrong (arrested in 2019), and two vice-chairs of the Central Military Commission of the army (Xu Caihou and Guo Boxiong).
In 2013 the Communist Party published "Document Number Nine", demanding that all party officials redouble their efforts to root out democratic ideas and values (see the translation here or better here). Here are the seven sins singled out in Document Number Nine: constitutional democracy; human rights; civil society; the free market; freedom of speech; historical revisionism (denying that communism improved China's conditions); and questioning the economic reforms. In 2014 Beijing responded calmly to pro-democracy protests in Hong Kong (compare with the 3,000 people killed in 1989 in Tianamen Square), but at the time i wrote that, by re-annexing Hong Kong, China inadvertently imported a virus, the virus of democracy (see The Democracy Virus). Xi spoke of "the worst security environment China has ever faced". The Communist Party enacted the National Security Law and announced the program for a computerized "social credit score", similar to the credit score used in the USA but expanded to monitor the social activities of citizens. That's when the whole nation, including (and perhaps especially) the enterpreneur class, started feeling the heat. In April 2015 Gao Yu, a 71-year-old Chinese journalist, who had been allowed for 16 years to criticize the Communist Party on both domestic and Western media, was sentence to house arrest for allegedly smuggling "Document Number Nine" out of the country (she is still under house arrest).
According to the government-owned Global Times, between December 2018 and February 2019 the Chinese authorities have shut down more than 140,000 blogs and deleted more than 500,000 articles. In typical Maoist fashion, bloggers often disappear only to reappear saddened by their actions, apologizing on television and promising to "communicate values with more positive energy".
The speech that Xi gave in January 2019 to the Communist Party represents the culmination of this process (that many view as a new Cultural Revolution, although that sounds far fetched). Xi identified seven major risks for China (which really means "for the Communist Party"): In concluding. Xi demanded tighter control of China's young people (many of whom never knew Mao, who died 43 years ago, and not even Deng, who died 22 years ago) and especially on the Internet (which is not really the Internet in China, since most of the services that we associate with the Internet). In 2017 (at the end of the 19th Party Congress) the Communist Party paid an unusual tribute to Xi: hiw stern views was enshrined in the Communist Party's constitution, something that had not happened since Mao ("Xi Jinping Thought on Socialism With Chinese Characteristics for a New Era").
China is being transformed into a high-tech police state: your face is continuously photographed and all your movements (buses, trains) require that your id be entered in a database. Combined with China's vast telephone, video and Internet surveillance network, this greatly accelerates the capability of investigators to track down who did what.
One can argue that these Orwellian policies betray insecurity: personal insecurity by Xi at the helm of the nation, and collective insecurity by the Communist Party, which may feel that it is losing its grip on a much more educated and modernized nation than it was in Mao's and Deng's times. In July 2017 the nation got a rare view into internal dissent when a popular politician, Sun Zhengcai, the youngest member of the politburo, was charged with corruption and sentenced to life imprisonment, but a few weeks later a top official, Liu Shiyu, accused Sun Zhengcai of plotting with the disgraced Bo Xilai and Zhou Yongkang to overthrow Xi (quote: "plotted to usurp the party's leadership and seize state power"s).
Xi, the son of one of Mao's early followers, was widely perceived as the compromise candidate of all the founding families of communist China, and he often seems to recycle the old ideological mottos that he learned as a child from his father and from his father's friends, old Stalinist and Maoist slogans; but this may have alarmed those who got rich when that ideology was abandoned.
In August 2018, Tsinghua University law professor Xu Zhangrun published an essay of 10,000 (Chinese) characters titled "Our Dread Now and Our Hopes" on Unirule that spread for a few days over the Chinese social media (summarized here in English). The essay criticizes the personality cult surrounding Xi and the abolition of term limits for the position of China's chairman. Xu was eventually suspended in March 2019, but that means that someone protected his job for seven months.
It could also be, quite simply, that the Communist Party wants to provide stability at a crucial time. China's history is a history of documents, not speeches, but Xi is often using speeches, not documents, to broadcast his views. From the beginning, external observers have been struck by how much Xi replays the old Maoist slogans, but also by the way he positions Mao's communist revolution not as a breaking point with the past but as a continuation of 5,000 years of Chinese civilization. That's a marked difference from Mao's hatred of Confucius and all ancient Chinese dynasties. Xi views a straight line leading from Confucius to Mao and now to himself. The other thing that is notable about his speeches, especially the latest one in January 2019, is that he is slowly but steadily removing Deng from collective memory. When i told Chinese friends that Xi never mentioned Deng in a long speech about the history of China's economic reforms, my friends initially didn't believe me and went to read the whole transcript. It was highly unusual.
At the same time that China has been cracking down on "Western influences" the Communist Party has been intent on restoring the primacy of state-run firms. When Deng began the economic reforms, most firms were still government or military firms. China's boom was driven, instead, by the private firms that were allowed to blossom during the 1990s and 2000s. The most famous abroad are the Internet giants: Tencent, founded in 1998; Alibaba, founded in 1999; and Baidu, founded in 2000. Their entrepreneurs were not only tolerated but even nurtured by the state, protected from foreign competition. It became obvious already in the 1990s that the private sector was driving growth and that state-owned enterprises were inefficient. However, the last few years have seen a renewed effort by the Communist Party to favor state-owned companies over the private sector. As the economy slows, the state decides who has to feel the pain, and in general the state-owned enterprises are the ones shielded from the pain, whereas the private sector is left to fend for itself. In fact, the private sector's percentage of GDP has shrunk for the first time in 30 years. Additionally, many firms have been forced to add officials of the Communist Party to their board of directors. These trends have alarmed China's entrepreneur class that is now increasingly trying to move money and family abroad. Hence the strict capital controls that China has imposed in recent years. A recent report on the happiness index of the super-rich hit a five-year low. Xi felt that he had to personally reassure the private sector multiple times (see for example this Xinhua article). But this doesn't seem to reassure the business class, whose feeling is that Deng-era economic reforms are slowly being undone to return to a more rigid communist system. For example, in February 2019 Chen Tianyong, a Shanghai entrepreneur, fled to Malta, leaving behind his real-estate empire, and published a 28-page article titled "Why I Left China". A running joke in China is that Trump is the only one who can save China from communism because his "trade war" may force the Communist Party to enact long overdue reforms instead of rolling back the reforms of the past.
It is not clear how much of what is happening in China is due to Xi's personal opinions. First of all, Xi is neither an elected official nor a real dictator: he is elected by the communist party, and nobody quite understands the way the party works behind the scenes, but he is accountable to those who appointed him. There is a big difference between Putin and Xi: Putin created his party, Xi was created by his party. The fact that Xi felt the need to accumulate ten titles may betray weakness, not strength. After all, Deng Xiaoping didn't have any title. He didn't need one: he was so powerful that there was no need to have a title. In particular, he was never the chairman of China.
Right after he became the supreme leader of China in 2013, Xi launched an ambitious pro-market reform program, which sounded as "neo-liberal" as anything ever attempted in China. His 60-point "Decision on Several Major Questions About Deepening Reform", announced at the 18th Central Committee's Third Plenum meeting in November 2013, promoted market forces from a "basic" role to a "decisive" role, and these terms have powerful meanings in communist jargon; and called for government to retreat from its influence on the allocation of capital, energy and land (the main resources that tightly controlled by the state). At the time, a leading financial planner of the Communist Party, Yang Weimin, interviewed by the government-owned People's Daily (the mouthpiece of the Communist Party), called Xi's "Decisions" a leap forward even more epochal than Deng's famous "southern tour" of 1992. This was all the more impressive because it came right after the global financial crisis that could have been used to dispute the positive role of free markets. Six years later, virtually none of those reforms has been implemented. In fact, Made in China 2025 almost completely reversed the role of government. Some Western analysts (the "hawks") think that the "Decisions" were just a ploy to fool the West into thinking that China was converging towards the liberal democratic model when in fact it was plotting to move away from that model. Another possibility is that Xi is not the "supreme leader" but simply the man who executes policies decided by the party, and different factions have different ideas on which policies to adopt. It could be that initially Xi had orders to continue the path of reforms but quickly the hardliners prevailed and caused a dramatic u-turn.
When China abolished the second term for the position of chairman, Western media assumed that Xi has appointed himself president for life, but this is not written anywhere. The only thing that has been written is that Xi may (may) rule for more than two terms. This has the advantage of demotivating anyone who was playing the strategy of waiting for Xi's second term to end.
Maybe the party wanted someone who could regain control of a country that, during Hu's second term, was rapidly falling into an anarchy eerily reminiscent of China's ancient past (Chinese empires tend to disintegrate into feuding kingdoms, and the Soviet Union ended up precisely that way when it liberalized both economy and society).
On the contrary, Xi could be in a precarious position: now that he has all the power and not even a term limit, he is expected to deliver.
Xi has launched two massive programs, one in foreign policy and one in domestic policy. The "One Belt One Road" (OBOR) initiative is an infrastructure plan to link China, Central Asia, the Middle East, East Africa and now also Europe (after Italy signed up) through a series of railways, roads and ports. The "Made in China 2025" initiative is a national plan to turn China into a high-tech powerhouse that could compete with and even surpass the West.
China has certainly spent a lot of money on both initiatives, but so far the returns are dubious. Initially, OBOR seemed to succeed on the political sphere, by expanding China's influence beyond its neighborhood. China needs natural resources, lots of them, to keep its economy running. China is surrounded by friends of the USA (Japan, Taiwan, South Korea, Afghanistan, Myanmar) and by traditional enemies (India, Vietnam). Combine these two factors and you realize that China's fear of encirclement is justified. OBOR breaks that "siege" and opens land and maritime routes to the natural resources of the Middle East, of Central Asia and of Africa. However, the investment in OBOR has stretched China's foreign-exchange reserves. It has also caused a backlash in countries where governments signed unfair deals with China (whether because they were incompetent or because they were bribed). Protests against Chinese investments have erupted in Bangladesh, Kazakhstan, Kenya, Sri Lanka and Ecuador. See Malaysia and Chinese colonialism. In the long run, OBOR may or may not provide Chinese corporations with a freeway to faraway markets, but in the short term it is a significant cost, which adds to the bad investments made by China in supporting the failed governments of Venezuela and North Korea (China's loans to Venezuela are estimated to be $60 billion, and Venezuela has no way to repay them).
To make things worse, at the same time that OBOR partners in the west are getting worried about China, China has angered neighboring countries with an aggressive policy in the Chinese Sea. His actions stand in sharp contrast with the actions of his predecessors Jiang and Hu, who were low-profile leaders. China has also a unique way to misunderstand the world's public opinion. When large demonstrations against dictator Maduro shook Venezuela, China didn't miss the opportunity to support the dictator while most of the world (more than 100 countries) supported the opposition. Besides projecting a sinister image on the whole of Latin America, China also appeared to be simply following Russia (not the behavior of a world power but rather the behavior of a satellite).
In between OBOR to the west and the Chinese Sea disputes in the east, there is India. China has never been popular in India. India resented China's invasion of Tibet, which happened when India had just become independent and didn't have the means to influence the outcome (and India is still home to millions of Tibetan refugees, including the most famous one, the Dalai Lama) and in 1962 fought a war against Mao's China over a Himalayan territory. Trade between China and India is now wildly unbalanced, with India flooded with cheap Chinese goods. There is hardly a day when an Indian newspaper doesn't publish an anti-Chinese article. If there is one country that has been alarmed by China's rise to the east and to the west, that country is India, which has almost the same population of China.
Whatever the merits of OBOR, there is an aspect of it that is embarrassing to China: most countries demand investment in US dollars, and China itself demands repayment of debts in US dollars. This doesn't bode well for China's ambition to make its currency (the remimbi) an international currency. In November 2015, the International Monetary Fund awarded the remimbdi the status of "reserve currency", just like the euro, the Japanese yen, the British pound, and the US dollar. But the remimbi still accounts for only 2% of international payments compared with 40% in dollars. That is embarrassing. Poor countries are more likely to accept the currency of tiny Switzerland than of giant China. Obviously, this is not what one expects of the world's new superpower. The Chinese themselves like to save money in US dollars, and rich Chinese send money abroad, as the "Panama Papers" revealed. In fact, the Chinese were the biggest group of clients for Panama's law firm Mossack Fonseca, almost 30% of its clients, including Xi's brother-in-law. The credibility of the remimbi as an international currency is still rather low.
When it was announced in 2015, "Made in China 2025" was largely ignored in the West, but China's repeatedly claimed that it was about to catch up and even surpass the USA until the USA started listening. The consequence is that now the USA is the middle of a "Chinese scare". See Sinophobia: China viewed from the USA and... the USA viewed from China. And not only the USA: apprehension has spread from the European Union to Australia). Deng's China was humble: we are a poor country and need to work hard to lift ourselves out of poverty. Xi's China is bold: we are the new world superpower. Obviously, neither the West nor the neighbors felt intimidated by Deng's China, which was actually viewed as a benevolent power by most of the developing world, whereas now both the West and the neighbors feel intimidated by Xi's China. The problem is that "Made in China 2025" requires China to do real innovation, just copy other people's ideas, and so far China has been very good at copying and applying innovation coming from the West, but incapable of real innovation. Chinese universities simply teach US textbooks, big corporations mostly copy technology from the West, and the vast majority of startups are born to simply copy a Western product and adapt it to the Chinese market, sometimes simply translating the user interface into Chinese. Most Chinese entrepreneurs who visit Silicon Valley don't want to hear about long-term research projects: they want to hear about new startups with hot products, with the clear intention of copying it for the Chinese market. This model has worked so well that it will be difficult to change it. China is slave of its own success. Fundamental research is just not in its genes. It's the classic vicious loop of regions that don't have the innovation gene: "if nobody has done it yet, there must be a reason". Both scientists and investors know this well. In August 2018 when Hu Angang, an economist close to president Xi and an ardent cheerleader of "Made in China 2025", claimed that China had passed the USA in science and technology, a group of scholars from Tsinghua University, Beijing's most prestigious universities, publicly demanded his resignations, an act rarely seen in communist China: they felt that he was misrepresenting the situation and instilling a dangerous misunderstanding of China's real status. (Read Hu's book "China in 2020: A New Type of Superpower"). Whatever the reality of China's high-tech industry, the West read a lot more into "Made in China 2015" than the Chinese themselves read into it. In fact, Trump's trade war may have legitimized it beyond the wildest dreams of the Communist Party (see The Effects of the Trump Trade War on China: Waking up the Giant). China graduates ten times more STEM students than the USA: what are those students supposed to do, just cheap shoes? Of course they are supposed to work on all sorts of advanced technology, with or without an official government plan. China's mistake was to make a big deal of something that is happening naturally. China seems to have recognized the danger of emphasizing its ambitions and, in the second half of 2018, "Made in China 2025" virtually disappeared from Chinese news outlets. The state-run Global Times felt the need to downplay "Made in China 2025" explaining that it is no more than the Chinese version of Germany's "Industry 4.0" initiative (launched in 2012). Too late: the European Chamber published an alarming study and the USA began multiple investigations on China's alleged theft of intellectual property. (See Does China steal?)
Western paranoia about "Made in China 2025" is probably wildly exaggerated. The intentions were certainly good, but the implementation is sometimes farcical. China is one of the few countries in the world whose citizens cannot use any of the high-tech platforms of 2018: Google, Facebook and Twitter are banned in China as are websites like Slideshare and (occasionally) Wikipedia. The damage done to scholars and students is not trivial. These are the websites that scholars and students routinely use for their research and to share knowledge with other scholars and students. There is a lot of junk on the Internet, but there is also valuable knowledge about science and technology. This deprives Chinese students and scholars of an important source of knowledge. Chinese scholars are no better off than Madagascar's scholars. I was one month in Madagascar and i could access the Internet with decent speed every now and then. In China i can rarely access the Internet with the same speed because i have to use a VPN to view any of the important websites, and China is even cracking down on VPNs. Most Chinese don't have a VPN because you need a VPN to download a VPN, which means that you can only do it when you are abroad. If you consider "real" Internet access, mainland China is not much more advanced than Madagascar. It just has a lot of cash, thanks to the export-oriented economy invented by Deng 40 years ago. Mainland China can throw cash at any project and hope that out of its billions of dollars and thousands of (very smart) engineers something good will come out of it. Expatriate students and scientists who return from abroad are very valuable to China because they learned something that is difficult to learn by staying within China: somehow it hasn't occurred to the Chinese bureaucrats that the easiest way to solve the problem is not to hope that Chinese expatriates return to China, but to allow its citizens the same Internet access that advanced countries have. In addition, the waste is sometimes colossal. While corruption has been largely tamed by Xi's anti-corruption (and long overdue) campaign, the same campaign has made many bureaucrats fearful of not satisfying the demands of the party, i.e. it has put pressure on mid-level bureaucrats to invest (or to pretend to invest) their money in the goals of "Made in China 2025" but often with no clue on how to do it in effective ways. China is a country whose native universities, since Mao's times, produce obedient servants, not creative innovators, and whose technology parks have trouble attracting foreign experts (who wants to work in a country where you can't even check your Gmail email and your Whatsapp text messages?) The combination of Internet censorship and education style seems designed to produce highly educated and very smart expatriates who emigrate to places like Silicon Valley and contribute to increase the scientific gap between the West and mainland China.
China is paying a huge price for not taking seriously the need for basic research. For 40 years mainland China was happy to use the West as its research center, free of charge: let the Westerners experiment and then we'll copy (and sometimes even improve) their inventions. The West (and Japan) invented the Internet, e-commerce, the smartphone, email, text messaging, mobile payment, the sharing economy, the search engine, social media and so on. China simply copied, adapted and sometimes improved. China invented nothing for the simple reason that it didn't even try: the whole system was conceived and designed as a "D" system to exploit the West's "R & D". Communist bureaucrats pretended to support research but they never did. They had little interest in advanced projects that could to fail and, if successful, would deliver results only in a decade or two. They focused on exploiting the results of Western research for immediate benefits. The global effect is that China has remained totally dependent on the West for advanced technology, always ten or twenty years behind, and virtually non-existent in science: China has 1.4 billion people, of which millions graduated in science and mathematics, but only won one Nobel prize in science, Youyou Tu. Compare with tiny Israel, whose population is 8 million, that won seven. The most famous Chinese in the world who did win a Nobel Prize is considered a criminal in China: the Dalai Lama (China annexed Tibet as one of its provinces and the Dalai Lama has to live in exile because he is the heir to the old rulers of Tibet). This fact, incidentally, doesn't encourage great minds to move to China: you could be the next one branded as a criminal instead of a role model.
No wonder therefore that in April 2018 ZTE almost went bankrupt when the USA banned the sale of advanced chips to it. No wonder that China cannot make airplanes to compete with Airbus and Boeing. The much vaunted Chinese investment in Artificial Intelligence (A.I.) is almost entirely directed to deep learning, a kind of A.I. invested in 2006 in Canada. China's massive investment in AI has led to a deluge of Chinese papers on deep learning, but those papers are rarely cited by others. Quote from an Elsevier study: "this surge in the number of papers produced has drastically reduced quality, with China scoring lower than Europe and the US based on the influence of published research." The study, using the "field-weighted citation impact (FWCI)", found that the USA (that has no national program for A.I.) is still the most influential region in A.I. scoring just under 2, with Europe (that also doesn't have a national program) scoring slightly under 1.5 and China not even 1."
Therefore both OBOR and "Made in China 2015" stand on shakey foundations. And they may have caused international problems for China: OBOR is causing a backlash against China in the third world and "Made in China 2015" is causing "sinophobia" in the West. And they are both very expensive.
That takes us to the next issue: government debt. In what amounts to a rare glimpse into internal bickering of the Communist Party, in 2018 an article by Xu Zhong, an economist at China's central bank, criticized the government for excessive spending. (See also this article by Yasheng Huang of MIT Sloan School of Management on how OBOR creates risky debt).
China is experiencing one of the largest credit bubble ever in the history of the world. The fiscal sustainability of this bubble is questioned by just about every economist in the world.
Officially, China's government debt is "only" $5.2 trillion, equivalent to about 47.6% of GDP. That's peanuts compared with the debt of the US government which, under Trump, has skyrocketed to more than 100%. The difference is that China's government debt is an abstraction: China is a communist country in which the government is both the lender and the borrower, in which government-owned banks lend money to state-owned enterprises. Therefore, like all numbers in China, it is not clear what that 47.6% is about. That's why the Institute of International Finance (IIF) estimated China's "real" debt to GDP at 300%. China's government generally spends a lot more to steer the economy than the USA or the European Union or Japan. For example, when the 2008 financial crisis hit the USA and then Europe, the USA pumped $152 billion into its economy. At the same time China, which wasn't even too affected, pumped $600 billion into its economy (that was much smaller than the US economy at the time). Chinese economists are worried about its rapidly aging population, a result of the "one child policy". The pension system is inadequate and underfunded. For a while, the one-child policy meant that each child had "six wallets": the parents and four grandparents. In the near future it will mean that each worker will have to support two parents and four grandparents. As household debt increases (see later), the pension becomes indispensable.
The government forces China's banks to lend money to the businesses that follow the government's strategic policies, such as the national program for A.I. and the "Made in China 2025". Corporate debt has reached the staggering figure of $18 trillion, almost double the gross national product and even greater than the gross national product of the USA (in 2017 China's corporate debt was 160% of GDP compared with 73% in the USA). That money has been spent mainly on domestic infrastructure and real-estate development. The domestic infrastructure is definitely being used but real estate may have already reached the point of over-capacity (hard to tell because Chinese families keep buying no matter how high the prices go). The banking policies also encouraged the manufacturing sector to borrow cheap money to increase production of goods, and a study by the Cheung Kong Graduate School of Business (2018) shows that China's manufacturing sector over-produced: it made more goods than its domestic and foreign markets require. Even scarier is the debt that ordinary families are accumulating.. Household debt now stands at about six trillions (53% of GDP). That is nothing compared with the USA, but the rate of increase is worrying: according to Bloomberg, China's disposable income has increased at an average rate of 10% annually, versus a 20% increase in household debt. Bottom line: Chinese household, corporate, and government debt all have skyrocketed since the 2008 global financial crisis. (See China Power's article Does China face a looming debt crisis? for more data).
The money pumped into the economy by China's government has generated a real-estate bubble that is eerily reminiscent of the Japan in the 1980s and of the USA in the 2000s. Home prices have increased more than 200% in some cities since 2015. In 2015 HSBC calculated the total value of residential housing as a percentage of GDP: China's ratio was 3.27 times GDP. Japan's bubble peaked in 1990 at 3.7 times GDP. The US bubble peaked in 2006 at 1.75 times before crashing in the Great Recession of 2008-10. China's GDP per capita is still only a fraction of GDP per capita in the USA or Japan: $17,000 in 2018, compared with $43,000 in Japan and $60,000 in the USA. Nonetheless, the bubble kept going in 2016, 2017 and 2018.
Too many foreign experts have said too many times that China's is not sustainable, and, yet, China is still around, and growing.
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