Highlights – Xi Jinping’s country, China, is quietly pursuing a strategy that could lead to a devastating industrial collapse. China is pursuing a strategy of “beggars to their neighbors.” Surprisingly, this strategy has become so powerful that even Trump’s rapid tariffs have failed to dent it.
China’s Strategy of Beggars to Their Neighbors
Beijing: China quietly employs cunning tactics, and Xi Jinping’s country is doing just that. This time, the strategy is to “beggar their neighbors.” To achieve this success, China’s weapon is exports, which even US tariffs have been unable to hamper. The flood of Chinese goods that is sweeping the world is likely to bring a devastating economic crisis. Under the guise of trade, Xi Jinping’s country is conspiring to beggar its neighbors. Find out how this dangerous Chinese strategy is working.
Analysts say Beijing is playing a dangerous game called “Beggar Thy Neighbor.” Local industries, struggling to compete with China’s aggressive low-cost manufacturing, are now on the verge of collapse. This isn’t just trade; it’s an economic war, in which China is boosting its own growth by jeopardizing the economies of other countries.
By establishing dominance over a vast array of manufacturing sectors, China has put pressure on global supply chains. This situation, while seemingly beneficial for consumers, could lead to a country’s industrial decline in the long run.
This strategy stems from China’s domestic overcapacity. When China’s production capacity exceeds domestic demand, it dumps surplus goods into the international market at extremely low prices. This export boom is fueled by Beijing’s government support and subsidies, which no private company can match.
Supply Chain Control
China is establishing monopolies in every sector of manufacturing, from electric vehicles (EVs) to solar panels and even simple goods, making its trading partners increasingly dependent.
US Tariffs Couldn’t Do Anything
US tariffs haven’t been able to stem China’s export storm. Despite numerous restrictions, imports of Chinese goods into the US have grown 10 percent year-on-year. Over the past five years, China’s export volume has grown rapidly, while imports have fallen by about 3 percent.
The biggest twist now is that China is capturing a large share of the global manufacturing market, but it isn’t buying goods from the world in return. This is a one-way street, proving China’s “beggar-the-neighbor” strategy.
Goldman Sachs’s ‘terrifying prediction’: Global growth will be negative!
A Goldman Sachs report has sounded the alarm for the global economy. Previously, when China, a country with a massive population, saw a 1% increase in production, it would import more, providing a positive boost of 0.2% to global growth. Now the situation is reversed; China is exporting more, meaning China’s growth has become detrimental to the global economy.
Goldman estimates that any benefits to consumers from cheap Chinese goods are far outweighed by the setback to the local manufacturing sector. As China grows at a rapid pace of approximately 0.6 percentage points annually, the rest of the world’s growth rate could decline by 0.1 percentage points annually.
Who will become impoverished?
China’s “make your neighbors beggars” strategy is going to have a devastating impact on many countries, but its most dangerous impact in the near future could be seen in countries like Europe, East Asia, and Mexico.
