• Xi Jinping is preparing for his second decade in office.
• Xi prepares to overthrow the United States by 2030.
• China’s economy is “in severe peril.”

As Xi prepares to overthrow the United States by 2030 and enter the following decade in power, China’s economy is “in severe peril.” The scenario now appears to be much less favorable.

As Xi gets ready for his second decade in office, he must deal with growing economic difficulties, notably an unsatisfied middle class. If he is unable to restart the economy, China will experience declining productivity and innovation as well as escalating social unrest.

According to Doug Guthrie, director of China Initiatives at Arizona State University’s Thunderbird School of Global Management, “China was on a path for 30 years that gave people great hope,” adding that the nation is “in severe difficulty right now.”

A slowing economy and sporadic dissent

Despite the fact that Xi is one of the most powerful leaders China and its governing Communist Party have ever known, some observers think he cannot take credit for the nation’s incredible development.

Sonja Opper, a professor of Chinese economics at Bocconi University in Italy, asserted that “Xi’s leadership is not responsible for China’s economic success.”

She said, “Xi was able to take advantage of an ongoing entrepreneurial movement and the quick growth of a private [sector] economy that earlier presidents had unleashed.”

Instead, Xi’s initiatives in recent years have given China a tonne of trouble.

Beijing’s extensive crackdown on the nation’s private sector, which started in late 2020, and its steadfast adherence to a zero-Covid policy has had a negative impact on the economy and job market.

If anything, Opper claimed, Xi’s leadership may have slowed down some of the nation’s growth dynamics.

Over the past two years, Alibaba and Tencent, the crown jewels of China’s tech economy, have lost more than $1 trillion in market value. Tens of thousands of workers have been laid off and the sector’s sales growth has stalled, contributing to record-high youth unemployment.

The real estate industry has also taken a beating, hurting some of the biggest home builders in the nation. The fall in real estate, which contributes up to 30% of GDP, has led to widespread and unusual middle-class discontent.

As a result of thousands of irate homebuyers refusing to pay their mortgages on stalled projects, authorities were forced to exert pressure on banks and developers to quell the discontent and allay concerns about systemic financial risks. This year, there have been other instances of dissent as well.

A peaceful demonstration by hundreds of depositors seeking their life savings back from rural banks that had frozen millions of dollars worth of deposits was forcibly put down by Chinese police in July. The banking crisis exposed the failing financial condition of China’s smaller banks as well as endangered the livelihoods of hundreds of thousands of clients.

Many middle-class individuals are dissatisfied with Xi’s leadership and disappointed with the country’s recent economic performance, according to David Dollar, a senior fellow at the Brookings Institution’s John L. Thornton China Center.

Analysts claim that the financial system is vulnerable as a result of the nation’s unrestrained, debt-fueled expansion in the previous ten years and that a new paradigm is required.

According to Neil Thomas, a senior analyst for China and Northeast Asia at Eurasia Group, “China’s growth during Xi’s decade in power is primarily attributable to the general economic approach adopted by his predecessors, which focused on rapid expansion through investment, manufacturing, and trade.”

But he said that the paradigm had “reasonably diminished returns” and was causing more environmental harm, economic inequality, and debt.

With greater state controls, Xi is putting the future of China’s enterprises at risk while also attempting to transform that model, according to analysts.

The 69-year-old leader began his purge to control the “disorderly” private corporations that were becoming too dominant. As part of his “shared prosperity” objective, he also seeks to redistribute wealth within the society.

Xi envisions a “new normal” in which consumption and services replace capital and exports as the primary engines of growth.

However, thus far, these actions have brought on one of China’s greatest economic crises in the past forty years.

China’s GDP is expected to decelerate significantly this year, from 8.1% in 2021 to 3.2% this year, according to a recent IMF prediction. The only year with a worse growth rate for the nation than that would be 2020 when the initial coronavirus outbreak severely hurt the economy.

China has under Xi not only been more isolated but also suffered a deterioration in US-China ties. His unwillingness to denounce both China’s recent action against Taiwan and Moscow’s invasion of Ukraine could further sour relations between Taiwan and the United States and its allies.

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