A series of economic crises have affected China since the country enacted its zero-COVID policy during the COVID-19 pandemic.

Background

COVID-19 pandemic in mainland China

In December 2019, the first case of SARS-CoV-2 was reported in Wuhan.[1] The outbreak in January 2020 was the impetus for a broader pandemic; the World Health Organization formally declared a pandemic on 11 March.[2] In response, Xi Jinping's administration pursued a zero-COVID policy. On 23 January, amid a rising death toll, the Chinese government imposed a travel lockdown on Wuhan, confining citizens within the city.[3] In March, nearly all foreigners were barred from entering the country.[4]

Crises

Property sector crisis

In August 2020, the Chinese government enacted new regulations on the amount of debt property developers can incur. The new regulations affected Evergrande Group, China's second-largest property developer, and the Chinese real estate market as a whole.[5]

Debt crisis

Financing affiliates in local governments—who depend upon the vitality of the real estate market—responded to the property sector crisis by borrowing the land that developers can no longer afford. The excess borrowing has created a debt crisis; China has lent nearly US$1 trillion to over a hundred developing countries.[6]

Youth unemployment

Since January 2023, the unemployment rate among young people in China has risen. In August, the Chinese government suspended its monthly unemployment report.[7]

References

  1. ↑ Wee, Sui-Lee; McNeil Jr., Donald (8 January 2020). "China Identifies New Virus Causing Pneumonialike Illness". The New York Times. Retrieved 25 August 2023.
  2. ↑ "Coronavirus confirmed as pandemic by World Health Organization". BBC News. 11 March 2020. Retrieved 25 August 2023.
  3. ↑ Buckley, Chris; Hernández, Javier (23 January 2020). "China Expands Virus Lockdown, Encircling 35 Million". The New York Times. Retrieved 25 August 2023.
  4. ↑ Bradsher, Keith (26 March 2020). "To Slow Virus, China Bars Entry by Almost All Foreigners". The New York Times. Retrieved 25 August 2023.
  5. ↑ Moreno, J. Edward (21 August 2023). "What to Know About China's Real Estate Crisis". The New York Times. Retrieved 26 August 2023.
  6. ↑ Bradsher, Keith (8 July 2023). "Why China Has a Giant Pile of Debt". The New York Times. Retrieved 26 August 2023.
  7. ↑ Fu, Claire (15 August 2023). "China Suspends Report on Youth Unemployment, Which Was at a Record High". The New York Times. Retrieved 26 August 2023.
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