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China’s crackdown threatens its economic superpower

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China's economy changes after 40 years

China’s crackdown threatens its economic superpower

Beijing continues to crack down on businesses, damaging its markets and the shares of companies that trade in overseas markets, such as the U.S.

China endangers business models that helped it to become the world’s second-largest economy.

This crackdown affected Alibaba, Ant Group, and Tencent, forcing a massive outflow of foreign funds from China. It might also destroy domestic customer confidence in a model that lifted several million people out of poverty during the last 40 years.

With these increasing restrictions on freedom of speech, individual freedoms, human rights, and capital investments, China believes that it does not matter what kind of economic system is used, as long as the system works.

According to Deng, it is not important what color is a cat. If it catches mouse, it is considered a good cat.

Possible consequences

Deng’s economic reforms seem to be in danger that might have various consequences for its economy and markets.
Xi Jinping tries to put power and party above the country’s profits, which is critical in future prosperity to the nation’s status as an advanced economy.

China’s different markets perform in the worst way in a world where most markets show double digits.
Shanghai shares decreased again by 1.9% on Wednesday, while China-H shares are also down by 12.4%. Hong Kong is reducing by 3.4%.

China’s unreasonable positions might result in isolating its economy.

As a result, the U.S., Australia, Japan, South Korea, the E.U. and Taiwan might take measures to offset China’s apparent projections.

The magazine Foreign Affairs chronicled many of the country’s weaknesses lately, such as the lack of preparation for Xi’s successor.

Beijing lately met with a couple of business leaders to raise their concerns.

China might face an economic war while military engagement between East and West remains the same. With that, an implosion of the global economy, China and its people will suffer most.

The post China’s crackdown threatens its economic superpower appeared first on FinanceBrokerage.

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