China’s new top leadership team, unveiled in October at the 20th Congress of the Chinese Communist Party, has confirmed the political direction for the country in the years ahead, but the economic outlook is still to be fully clarified.
The country’s economy has been impacted negatively by a number of major trends in the past few years. Internationally, there has been the decoupling of China and the U.S., particularly in terms of technology and finance, exacerbated by the ongoing trade war. Domestically, there has been a real estate crisis, an ever-greater government debt overhang and problems in big tech and other industries resulting from a raft of policy tightening. China’s demographic problem — an aging population and shrinking labor force—underlies longer-term concerns for the country’s economy, with some now predicting that China may never become the world’s largest economy as once expected.
