PREDICTION: The Fall of the Chinese Empire

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Source: Roger Froikin, February 9, 2024

The story has it, that people have come to believe internationally, is that China is in a growth phase, and will soon be the largest economy in the world, on which the rest of the world will depend, and that China will, though its economic prowess, the expansion of its presence in the South China Sea, and with its involvement in South Asia and Africa, eventually be the premier nation in the world – The Middle Kingdom to which the world will pay homage.

I DO NOT AGREE, AND NEITHER DO A LOT OF SERIOUS CHINA EXPERTS

But…

China has already started its decline. Part of the reason for decline is that it has ignored certain social and economic issues to accelerate growth, and part is because it has used methods to grow that depended on the patience and tolerance by others which has a limited life expectancy, and part is because of the fact that when a nation pushes too arrogantly, there is often a backlash.

Like it or not, the facts are that China has based its fantastic growth over the past 40 years on several elements not available to other countries. (1) Cheap Labor, that allowed China to
concentrate efforts on undercutting prices of competitors and driving them out of business,
making the world dependent on Chinese production; (2) Stealing technology – by having Chinese students abroad by the millions to steal technology and bring it home along with their skills learned abroad, and (3) by forcing companies mesmerized by the promise of great profit by doing business in China, to share technology developed elsewhere, and (4). The ability of a despotic regime to organize and direct its people and assets to fit its plans for constant expansion without concern for public opinion or dissent, including slave labor or virtual slavery, and (4) Using Government controlled investment groups to do infrastructure deals in the undeveloped world of such cost as to force those nations to turn over resources to China’s control.

In short, China’s policies have been controlling and predatory, but the fact of life is that such policies have a natural ending. On top of all this has been Covid, and however Covid got out, the evidence shows that the leadership of China intentionally hid the facts and infected the rest of the world, regardless of their reasons.

And this does not end the story. China the First Nation to recognize Taliban rule in Afghanistan and invite Taliban terrorists to Beijing for discussions. China has killed human rights, despite agreements, in Hong Kong, threatened Taiwan, damaged Australia for daring to disagree with Chinese policy, and has built a chain of military bases in sea lanes along the east coast of Asia.

And now China has problems.

The Chinese population is rapidly aging and the numbers indicate that China may be aging faster than any other place on the planet other than Serbia and Lithuania, and this means greater expenses with fewer people producing.

China’s growth rate has stalled at a time when. Military spending has soared.

Wages in China are no longer cheap, with the average wage now almost as high as Italy’s and higher than Portugal’s, meaning the days of cheap production to drive rivals out of business and attract foreign companies to produce in China for export, are done. More and more companies willing to do business with China are becoming more circumspect about contracts and conditions than previously, and many countries are not willing anymore to tolerate lop-sided trade treaties or theft of intellectual property, And along with all these negative changes for China, the Chinese leadership, has decided to increase an aggressive stance on Taiwan, Hong Kong, and the Western Pacific, rather than look for ways to be more cooperative and conciliatory.

The Covid crisis, the pandemic, clearly began in China, and clearly was exploited by China that intentionally lied about it, intentionally blunting any possible worldwide response, while creating the conditions for worldwide spread of infection. In another era, this would have been seen as an act of war.

And now, companies are shifting business, production, away from China. The textile business has already seen relocation to SE Asia and many other economic areas are experiencing inquiries from companies previously in China. That does not mean they are abandoning China outright, but it more and more is becoming a move of production to lessen dependence on China.

And Europe and the North America has, to a degree woken up a bit and there is pressure to bring business and production home that will blossom once those who seem to be in the pay of China are out of power in Washington DC.

As it always happens when a company – or a nation – starts a decline with a leadership that is committed to the previous agenda, instead of reevaluating where they went wrong and how to adapt to changing circumstances, they double down. China is doing just that right now after the Communist Party Congress and the solidification of Xe’s role as leader. In the past year they have chosen to limit small businesses, the place from which innovation and adaption generally comes, pushing many out of business, and they have increased draconian measures in Hong Kong, even to the point of destroying the Tiananmen memorial that students fought for, and they threatened Taiwan., all choices that will guarantee the downward movement.

Remember what the predictions by experts were over the past 60 years. Remember those that said the European Union would overtake the USA as top economic power, and replace the Dollar with the Euro as the World’s currency? Remember when Japan was going to do the same ?

Now some of the same experts are saying China will be the top world power and the Yuan will dominate financial markets. Or was that before the Yuan went from 50 cents to 17 cents?

Well, in the past couple years, the Chinese economy, valued in dollars has lost up to 40% of its value and it is headed further down.

Somethings to think about.

Yet, in spite of all this, US Secretary of State Blinken, went to China as a supplicant warned by the Chinese to “show proper respect”, not unlike in the days of the “Middle Kington”. Expecting others to bow low.