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China’s President Xi Jinping is now in the hot seat. With Donald Trump getting back in the White House and hammering a promise to ramp up tariffs on Chinese imports, Xi is staring at what could very likely be an economic storm for China. Trump is serious about slapping 60% tariffs on Chinese goods. For China, an economy struggling with weak consumer spending, a rocky property market, and shaky export numbers, this is terrible timing. Xi’s 5% growth target for this year already looked like a stretch, and now Trump’s new tariffs are threatening to make it completely out of reach. Investors are watching as China’s economy wobbles, and everyone wants to know: is Xi about to buckle under Trump’s pressure? Deflation fears, economic doubts, and the property market disaster Xi’s government has been trying to stabilize things with stimulus measures, but the results have been underwhelming. Consumer spending has stayed low, and the country’s giant real estate market—once a pillar of growth—remains in turmoil. In fact, the property sector has seen its worst downturn since 2014, dragging down home prices and shaking up consumer confidence.  Bloomberg economists don’t see much hope for Xi’s growth target. By September, Bloomberg’s survey showed fewer than 20% of economists expecting China to hit the 5% goal. Top banks like Bank of America are openly questioning why Beijing’s policies aren’t doing more to revive domestic demand. China’s heavy reliance on exports as a growth engine isn’t the answer here either. Countries worldwide are wary of the impact of China’s cheap goods, especially when those products come at the expense of local industries. Vice Finance Minister Liao Min has defended China’s manufacturing, saying it helps keep global prices down, but that isn’t calming international critics. Some analysts worry that China could be heading into a…

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Filed under: News - @ November 13, 2024 11:20 am