China Is In Economic Dire Straits And They’re No Longer Able To Hide It

Official economic data from any government is always treated with suspicion by anyone with common sense. The US, for example, witnessed some of the most egregious statistical tinkering imaginable under the Biden Administration, not to mention outright lies and propaganda from the establishment media on the health of the economy. To this day no one has been fired (or tarred and feathered) for hiding the reality of the stagflation crisis. Any government or corporate economist that called the threat “transitory” should be stripped of their financial prestige and banished to a cash register at Arby’s.

And let’s not forget Biden’s misrepresentation of the labor market, portraying millions of new jobs for illegal migrants and visa holders as if they were jobs benefiting American citizens. In the US and across the western world, lying about the economy is generally seen by politicians as a temporary solution to secure reelection. However, in China, lying about the economy is treated as a national security imperative. If there’s anything in the world that gives communists a feeling of existential dread, it’s the fear that their ideological enemies will discover proof that communism doesn’t work.

The Trump Administration’s tariffs on China are not the initiator of the nation’s troubles, they are more a bookend to a process of decline that has been ongoing for years.

Overall tariffs on Chinese goods currently sit at 124%, but some goods will be taxed as high as 245%. Trump has given a 1 month exemption on electronic parts and devices, perhaps to offer manufacturers like Apple, Nvidia and Microsoft time to arrange sourcing from alternative vendors. The problem for Chinese manufacturers is not just the tariffs but the uncertainty of timing and sudden changes to policy. They say no one is willing to make a big move on production or shipments until the trade landscape becomes more predictable. This means most Chinese factories are frozen in stasis.

Trump’s tariff actions are widely criticized by the media as erratic or poorly planned, but what they don’t understand is that uncertainty is the real leverage, not the tariffs. What seems like a spur of the moment decision or a sudden capitulation on Trump’s part can be highly effective at throwing foreign governments and corporations off balance. Globalism requires a perpetual status quo, change of any kind is like holy water to a vampire.

Chinese shipments are on standby and orders are frozen. Nothing is moving.

At bottom, China will not be able to survive tariffs on the current scale for long (a single year of 124% tariffs would crush China’s economy beyond repair). The US is 15% of China’s export market, which may not sound substantial but their next largest trading partner (outside of Hong Kong) is Vietnam at 4% of exports. In terms of domestic buying, China is 11% of the global consumer market which is not too shabby, but compared to the US with its 30%-35% global consumer market share there is no chance that the Chinese will be able to fill the void domestically and stay afloat.

But the situation is far worse than most people know…

China has been suffering from a deflationary crisis since 2023. An uptick in exports during the pandemic was offset by the CCP’s draconian lockdowns. This was, essentially, fiscal suicide on the part of the government and China has been struggling ever since. Their property market has imploded, partially due to overbuilding through government subsidized infrastructure programs that flooded the market with poorly constructed homes and buildings that were then left to rot. Corporate defaults have run rampant and left investors with nothing.

There was some optimism that the government’s measures to end the crisis had been working to reinvigorate the market, but on Mar 31st, government-linked developer Vanke reported a record 49.5 billion yuan (S$9.1 billion) annual loss for 2024. It’s the company’s first full-year loss since its initial public offering in 1991, reigniting concerns about the sector and showing just how deep the problem runs.

When these projects do finally see some progress it is often due to dangerously poor construction standards and subpar workmanship; what many now refer to as “Tofu Dreg” buildings.

The deflationary spiral has been eating away at employment and has also resulted in numerous factories refusing to pay their workers on time (or at all). Unpaid wages are leading to frequent protests and a disturbing trend of factory fires. The government is limited in how it can respond to the problem. Stimulus is an option, but China’s overall non-financial debt is well over 300% of GDP already.

China’s attempts to hide the decay from the outside world are becoming less and less effective. With Chinese citizens able to access the internet beyond the “Great Firewall”, more and more videos are being leaked by people within the country who are tired of the misinformation. Again, the CCP views negative economic data as a national security threat and any citizen caught leaking this info could be subject to harsh punishment. Chinese citizens have taken substantial risks to get the truth out there.

It cannot be stressed enough that the global economy is largely a farce, but China is closest to the edge of the cliff in terms of consequences and crisis. The interdependency of globalism has left many nations without the ability to weather a trade dispute and China’s survival is almost entirely based on steady exports to the west and the US in particular.

Don’t let high paid TikTok and YouTube influencers fool you with videos of Chinese skyscrapers caked with LED lights or lavish parties with dancing robots. This is not the true China. Underneath the facade is a nation on the brink of disaster.


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AI Overview

China is facing a significant economic downturn, characterized by slowing growth, deflation, a housing crisis, and a rising debt burden. While China's official GDP growth targets have been achieved, many analysts believe the real growth rate is lower and that the economy is facing deeper structural problems. The collapse of the property sector, particularly the default of major developers like Evergrande, has triggered a financial crisis that has spread to creditors, suppliers, and local governments.

Key issues contributing to China's economic crisis:

Property Sector Collapse:

The tightening of borrowing requirements on property developers in 2020 led to a crisis that has severely impacted the sector, which once contributed about a quarter of GDP.

Deflation:

China has experienced deflation for the past two years, with prices falling for the first time since the 1960s.

Debt Crisis:

China's total debt-to-GDP ratio is high, especially at the local government level, with concerns about the ability of local governments to repay their debts.

Slowing Growth:

China's annual economic growth rate has decelerated significantly, with recent reports suggesting that actual growth may be lower than official figures.

Weak Consumption:

After reopening, private consumption has recovered more slowly than anticipated, with retail sales remaining below pre-pandemic levels.

Youth Unemployment:

The youth unemployment rate has risen significantly, with many young people discouraged by poor working conditions.

Possible explanations for the crisis:

Overinvestment in Property and Infrastructure:

China's rapid growth in recent decades has been fueled by significant investment in property and infrastructure, which has led to high debt levels and potential overcapacity.

Government Regulations:

While regulations aimed at controlling the property market were intended to prevent over-heating, they have also contributed to the current downturn.

Global Trade Tensions:

Trade tensions with the United States and other countries have also put pressure on China's economy, particularly its export-oriented industries.

Internal Political Factors:

Some analysts suggest that the leadership's priorities and potential reluctance to implement radical reforms may be hindering the country's ability to address the crisis.

Possible solutions and challenges:

Stimulus Measures:

China has implemented stimulus measures, including monetary policy easing, but these may not be sufficient to address the structural problems.

Fiscal Support:

Experts suggest that China needs to implement fiscal support measures, such as infrastructure spending and tax cuts, to stimulate demand.

Debt Restructuring:

Some suggest that China needs to address its debt problems, including through restructuring local government debt and allowing some defaults.

Economic Liberalization:

China may need to implement deeper economic liberalization measures to encourage private investment and consumption.

In summary, China's economic crisis is multifaceted, with the collapse of the property sector, deflation, and rising debt burdens being major concerns. While China has taken steps to address these issues, the challenges are significant and may require deeper reforms to achieve sustainable and balanced growth.

The European Super Grid : A Solution To The EU’s Energy Problems

Within the context of the European Green Deal, the electrification of the energy sector is of paramount importance. Only by substituting fossil energies for electricity will the European Union be able to reach its objective of being carbon-free by 2050. Such an ambitious project requires a significant amount of technical infrastructure to sustain it, and this is precisely what the European Commission wants to achieve through what has been unofficially defined as the “European Super Grid”. This article explains more in detail what the European Super Grid consists of, what are its main challenges and what it involves for the European Union on both the local and international level.

In a remarkable step forward, renewable energies reached and surpassed fossil fuels as the European Union’s main electricity source in 2020. According to a study carried out by the focus groups Ember and Agora Energiewende, during the year 2020 renewable power sources generated approximately 38% of the EU’s electricity, whereas fossil fuels accounted for about 37%. While this surely marked a significant stepping stone in the battle to reduce fossil fuel usage, the prized goal of cutting greenhouse gas emissions by 55% before 2030 is still a long way off.

With the demand for electricity rising every year due to the electrification of significant portions of production, the European Union will need to provide European citizens and companies with increasing quantities of electricity while staving off the recourse to fossil fuels. Until now, the matter has generally been addressed by focusing on the construction of more and better renewable energy infrastructure. Nevertheless, such a course of action needs to be complemented by something else. This is because renewable forms of power production tend to lack stability, meaning they cannot provide a continuous flow of electricity to meet demand. Solar panels don’t work when the sun goes down, and eolian turbines can’t produce power when the wind stops blowing. The opposite is true as well: in some cases renewable power production may surpass demand, which would make the surplus power go to waste. This is where the European Super Grid comes into play.

The European Super Grid: what is it exactly?

The European Super Grid is an umbrella term to define a series of projects taking place in Europe and beyond. Upon completion, these projects would result in the creation of a power network interconnecting European countries between themselves and with other regions, such as North Africa and the Middle East. The Super Grid aims at both improving energy interconnectors and creating new ones between European areas, thus increasing the capacity and quality of power transmission among countries. Although the majority of the projects are still in planning phases, many have already begun production.

Concretely, the energy interconnectedness will allow for European states to sell their energy surpluses to other countries, and to buy others’ excesses in times of deficiency. This energy sharing is key in counterbalancing the effects of renewable energy not being a stable and reliable source of electricity. This dynamic can be better seen through an example: during the summer, the power production by solar panels in Southern European Countries increases exponentially, which can make the producing country end up with an energy surplus. Without the European Super Grid, that power produced would go to waste. Through cables and power infrastructure that same energy can be exported to other countries, for example Northern or Western European States, regions that due to a different climate are unable to fully take advantage of solar power.

The same can happen the other way around. During the winter, wind power from turbines or hydropower from dams tend to be more reliable and abundant than solar power. Northern or Western European countries can easily produce both thanks to geographical and climate-related reasons, and as such may be able through the appropriate infrastructure to export their surpluses to countries in need. This would effectively prevent European countries from falling back on fossil fuels for energy production during periods of deficiency.

This monumental project would be beneficial in two main ways. Economically, it is estimated that the Super Grid will make the European Union save between 12 and 40 billion euros every year. Environmentally, it would help remove fossil energy from electricity production for good.

The Super Grid and the European Green Deal: “a match made in heaven”

Within the context of the European Green Deal, the development of a fully integrated European Grid is of great importance. With the production and use of energy accounting for approximately 75% of its carbon emissions, it is one of the main interests of the European Union to decarbonize power production in order to achieve the 2050 goal of a climate-neutral continent. The construction of an interconnected energy system is thus one of the EU’s priorities, which explains its willingness to fund most projects related to the ESG. For example the construction of the Celtic Interconnector, a series of power cables that will connect Ireland to the European grid, is currently benefiting from European funds. The European Commission aims to achieve 15% of interconnection by 2030, meaning that by then each country should possess the appropriate infrastructure to export at least 15% of the electricity produced by its power plants. Considering the numerous projects that are currently under construction, this is an achievable goal.

But the main reason why the European Super Grid perfectly suits the needs of the Green Deal is the fact that it takes into consideration the differences in terms of energy mix of individual European countries. Many EU policies aiming at reducing carbon emissions were often criticised by Member States for not taking into consideration the disparities between countries, and consequently the difficulties that some may encounter to reach objectives that could be easily met by others. The Super Grid respects these differences, allowing countries to specialise in the types of energy production they find most fruitful. Although some broad objectives are defined, the Member-States are allowed to micromanage their specific cases as they please, having a lot of freedom to decide how to move forward.

The geopolitical implications of the Super Grid, a path to energy independence?

The EU’s new energy policy, defined through the European Green Deal, has three objectives: sustainability, competitiveness, and most importantly, security of supply. It is a well-documented truth that the EU remains extremely dependent on imported energy. Some countries of the Baltic and Central European regions are overwhelmingly dependent on one single supplier, Russia being one of the main ones. This puts Europe in an extremely vulnerable situation, with geopolitical incidents in either supplier or transit countries being a very real possibility. For example, the Ukrainian conflict that started in 2014 heavily affected gas supply all throughout Europe, causing inflation and shortages. In a similar fashion, the partnerships with Russia have proven to be convoluted and unstable, most notably due to the participation of the European Union in NATO and the continuous political clashes with the Russian regime over human rights.

Furthermore, with environmental crises making power supply incredibly volatile, the EU risks getting caught in troubles outside of its capabilities. The succession of energy crises that unfolded in the last few months confirm such theory: an increased global demand and a particularly cold winter skyrocketed prices for power and gas, leaving the European Union to deal with the consequences. Within this context of geopolitical uncertainty, the European Super Grid may act as a solution by reducing the reliance on liquid gas and oil, and most importantly by increasing power production within the EU itself. This would put the European Union on the right path to becoming self-sufficient regarding power supply, and thus closer to being energetically independent.

The implementation of the ESG would also increase European integration between Member States, creating a more interconnected and cohesive Union with the capacity to speak with one unified voice on the energy world market, on issues regarding power production, environmental crises or climate change. Diplomatically, an electrically interconnected European Union would carry more weight in the international decision-making arena, with more bargaining power and less concerns over the possibility of countries using resources as leverage in geopolitical negotiations. Furthermore, the Super Grid would not only concern the European Union per se but also its periphery, reaching countries such as Norway, Iceland and the Northern African region. This dynamic has the potential to promote the EU’s external policy objectives and values in other regions, thus increasing international cooperation.

Still a long way to go

As previously stated, the European Super Grid is far from being completed, but numerous projects are currently being built or under active planning. As mentioned before, the Celtic connector is now under construction between Ireland and France. Other examples include the Spain-France underground electrical interconnection; the LitPol link I, an electricity link between Lithuania and Poland, and many others. Work remains to be done, but considering that the objectives for 2020 set by the European Commission were reached and those of 2030 seem within range, the hopes are high for the European Super Grid to be up and running by 2050. Current projects vary in scope, reach, funding and size, but at the end of the day they all contribute to the construction of the most extensive electricity grid the world has ever seen.

The only issue that remains tied to the development of the project is the possibility of a climate crisis. Indeed, for the Super Grid to really start proving its benefits, a certain threshold of interconnection must be reached. Before that happens, the power produced by European renewables might not be enough to fill the need for electricity that could arise from an unforeseen climate event. In case this ever happens, countries would be forced to draw power from fossil fuels in order to keep prices from hyperinflating and retain a somewhat stable supply of electricity. Since climate crises are expected to get worse in the following years, the possibility of countries failing to completely detach themselves from fossil fuels is likely. This would effectively create a vicious cycle where continuous crises lead to more fossil fuels being used, and so forth. To successfully avoid this scenario, projects tied to the ESG need to become a top priority in the next decade in order to make the transitional phase between low to mid-levels of interconnection as short as possible.

According to statistics, Europe is already the largest internationally interconnected grid worldwide, with countries exporting significant portions of surplus power to neighboring states. But the European Union can’t allow itself to rest on the laurels of its achievements, and must push forward in order to make power-sharing the norm. The European Super Grid is not a panacea to all of the EU’s environmental problems, but it surely is a solid foundation upon which the rest of the European Climate Policies can be developed.


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Power Grab: Brussels Plots €600 Billion EU-Wide Electricity Takeover

The European Commission has unveiled a staggering €600 billion plan to centralize control over the continent’s energy grid—a project marketed as green progress, but seen by critics as yet another power grab at the expense of national sovereignty.

The scale is colossal: we are talking about an unprecedented investment aimed at interconnecting national grids, overhauling infrastructure, and ensuring the transition toward a green economy over the next decade—a key objective of the von der Leyen Commission in both its previous and current terms.

The stated goal is ambitious. According to the Commission itself, this investment will be used to strengthen cross-border interconnections, expand transmission and storage capacity, and facilitate the massive integration of renewable energy, which is unreliable and hard to store. The plan, which Brussels claims it will outline by 2026 at the latest, aims to create a deeply integrated “meshed electricity network” that would enable a single energy market, ultimately placing energy oversight under EU control.

Brussels’ justification: Green transition and energy security

The official explanation hinges on two major arguments: on the one hand, the need to advance the economy’s decarbonization to meet Europe’s climate commitments; on the other, the urgency of strengthening energy security after the crisis triggered by the war in Ukraine and the subsequent break with traditional fossil fuel suppliers.

The European Commission and its parliamentary partners from the European People’s Party (EPP) are promoting the idea that “being green is being patriotic” as a strategy to counter conservative criticisms of the lack of competitiveness stemming from limited energy accessibility for businesses and citizens. However, critics say this is little more than sloganeering.

Brussels defends itself by assuring that, although high, the investment will pay off in the medium term. According to ENTSO-e (the European association of electricity network operators), annual savings of over €38 billion could be achieved if cross-border infrastructures are properly developed. This, combined with the promise to reduce external dependency and improve the system’s resilience, is presented as an unavoidable step to prevent new episodes of energy vulnerability.

That is the narrative. The reality is far less reassuring. Renewable technology cannot be stored effectively, and dependency on its supply causes serious headaches.

Because of this, legitimate doubts and suspicions arise. The recent energy crisis in Spain, marked by a blackout that partially paralyzed the country for several hours, has served as a catalyst to accelerate the EU’s pro-integration energy rhetoric. Both MEPs and technical officials have pointed out that greater interconnection with France would have mitigated the effects of the collapse, reinforcing the message that the “solution” lies in handing over more competences to Brussels.

It is striking that this episode, already being used to justify the urgency of the European energy project, coincides with the political timeline. For months, the Commission has been warning about the “insufficiency” of the Iberian network and the need to strengthen interconnections. The question is inevitable: is this a real technical flaw—or just another manufactured justification to advance Brussels’ federalization agenda?

The discourse around energy is not just technical—it is profoundly political. The creation of a “genuine Energy Union,” as demanded by the Commission, is one of the key pillars to consolidate an increasingly centralized European Union that shows less and less respect for the autonomy of its Member States. Electricity isn’t just infrastructure—it’s influence. Subordinating its management to Brussels represents one more step toward building a European superstate that many citizens reject, deeply worried about losing their national identity and democratic control over vital sectors.