A Crisis of Confidence Is Gripping China’s Economy
Summary
“Low confidence is a major issue in the Chinese economy now,” said Larry Hu, chief China economist for Macquarie Group, an Australian financial services firm. Unlike past crises that were international in nature, China is confronted by a convergence of long-simmering domestic problems — some a result of policy changes carried out by Mr. Xi’s government. In 2015, when its real estate market was teetering, Beijing handed out cash to consumers to replace rundown shacks with new apartments as part of an urban redevelopment plan that gave rise to another building boom in smaller Chinese cities. The real estate market is reeling from the government’s measures from three years ago to curb heavy borrowing by developers, while crackdowns on the fast-growing technology industry prompted many tech firms to scale back their ambitions and the size of their work forces. After six straight months of rising joblessness among the country’s 16-to-24-year-olds, the agency said the collection of those figures needed “to be further improved and optimized.” The bureau this year also stopped releasing surveys of consumer confidence, among the best barometers of households’ willingness to spend.