China‘s economy has suffered a major setback in the past few years. Do you know what the main reason behind the setback to the world’s second-largest economy is? Come, let’s know…
Talking about developed countries, China comes in second after America, and China’s economy is the second-largest in the world. In addition to being developed, a good economy also makes China very strong. But the strength of China, which is reflected in its economy, has seen a lot of change in that economy in the last few years. In the last few years, instead of growth in China’s economy, there has been a decline.
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China’s economy suffered a setback
China’s economy has suffered a setback in recent years. Due to the Corona epidemic, China’s economy has grown less than expected in the last three years, but due to different waves of Corona in the last few years, China’s economy has been badly affected. Due to the different waves of Corona, along with the business sector in China, the IT sector has also been badly affected. Many people have lost their jobs, and all these factors have shaken the economy of China.
Heavy drop in import-export
There are many reasons for the setback to China’s economy, one of which is the drastic decline in the country’s import-export trade. Due to Corona, there has been a reduction in production in the country, due to which the country’s imports have been affected. Not only this, but in the last three months, there has been a huge decline in the country’s exports. The decline in China’s import-export ratio has also had a bad impact on the country’s economy.
China’s economic system is getting worse
When the prices of goods increase or decrease in general, it is okay; it benefits the economy, but if the prices start increasing or decreasing very fast, then it harms the economy of any country. Something similar is being seen in China. In the world’s second-largest economy, China, there has been a big decline in the consumer price index (CPI and Producer Price Index (PPI) in July. The CPI fell by 0.3 percent compared to last year. At the same time, PPI, i.e., the production price index, decreased by 4.4 percent compared to a year ago.
Disillusionment of foreign companies
China imposed many restrictions during COVID. These restrictions broke the back of China’s economy. The Chinese government has been interfering in the business of private companies, which the companies do not like. The interference of the government and the restrictions of the government had a very bad effect on the companies, and the effect was that the companies were leaving China. Foreign companies are now turning to other countries, except China.
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