Why did the Chinese economy slow down?
The slowdown of the Chinese economy, which is progressively becoming more prominent, is a topic of great interest in 2019. Despite the fact that the Chinese government’s main objective was to address the issue of debt, the economic war that it found itself embroiled in throughout 2018 disrupted all trade balances. Consequently, the growth rate of the Chinese economy has been decreasing. In 2018, the Chinese economy grew by a mere 6.6%, marking the slowest growth rate in 29 years. This economic downturn not only impacts China but also Turkey, which could be negatively affected by different pricing as well as potential disasters in 2019. China may introduce different solutions to address its economic problems in the upcoming year and implement new plans accordingly.
The backbone of the economy
The economy is the cornerstone of a country, and as such, one of the most significant factors that can cause a country to decline is an economic slowdown. Due to the lack of significant progress in the Chinese economy in 2018, the country has entered into a period of stagnation along with the economy.
The Chinese economy has been facing significant challenges that have caused a decline in recent years, with demographic issues, a real estate bubble, and an abnormal debt stockpile being among the most important factors. Despite the former president of China being aware of these issues, effective action was not taken to address them. However, the new president has taken significant steps to strengthen the economy and prevent the economic slowdown with new regulations and important decisions. Nevertheless, the change in the US presidency has caused uncertainty in the economic landscape, making it difficult to predict the future of the Chinese economy.
Metamorphosis and Other Measures
With the changes in the US government, economic problems in China have resurfaced. Donald Trump’s election as president caused the Chinese government to once again seek new solutions. While attempting to address the structural issues that have plagued China’s economy in the past, the country may now face even more problems on top of its current ones. In response, the Chinese president has taken new steps to loosen the economy, hoping for improvement. However, these actions such as lowering interest rates may directly lead to economic weakness. In summary, China’s government has implemented the wrong policies, negatively affecting not only Turkey, but also other developing countries in terms of their economies.