Tough Lessons From China’s Fizzled Recovery
The economy was supposed to roar back this year, but festering problems caught up with it. The bigger shift has been is our own expectations of how well China can perform.
Hard lessons.
Photographer: Qilai Shen/BloombergInstead of being 2023’s banner economy, China was relegated to the ranks of the also-rans. Rather than roaring back after the draconian Covid-Zero curbs were erased, the country's recovery quickly fizzled. Prospects for a significant improvement next year are limited in the absence of sweeping efforts to crank up growth — something President Xi Jinping appears reluctant to embrace. There are lessons for everyone in how this former juggernaut came down to earth.
While China’s sub-par rebound will constrain world growth, it doesn’t have to be a disaster. The languishing expansion requires a healthy rethink of the country’s role in global commerce — and what we expect of it. As disappointing as the year has been, Beijing may have done the world a favor. Problems have been building in China’s economy for years, even before the pandemic. But so great was its prior performance, so rapidly did it catapult other major economies, that a merely mediocre performance is a shock.