Last year brought some pessimistic, even alarmist, analyses and commentaries on the state of China’s economy. Joe Biden called it a ‘ticking time bomb’. The Economist took a more sober approach with its cover story ‘Peak China?’ (13 May 2023). The same expression had been used – without a question mark – in a 2022 book by political scientists Hal Brands and Michael Beckley that was the talk of Washington. The authors held that China had become a ‘declining but defiant’ power whose unfulfilled dreams would encourage an aggressive stance in years to come.

These grim depictions are surprising, given the country’s 5.2% GDP growth in 2023. Yet gloomy predictions about China are nothing new. Its economy was said to be threatened by ‘overheating’ in the 2000s, by the financial crisis and downturn in international trade in 2009-10, and by capital flight and excessive debt in 2015-16. And Le Monde ran the headline ‘Cracks showing in China’s state capitalism’ in 2012.

Yet the public sector has never been wealthier, with 339.5trn yuan (around $49.0trn) of assets held by non-financial state enterprises at the close of 2022 – nearly three times the country’s GDP. The economy more than doubled between 2010 and 2022, according to the World Bank.

Though tales of crisis and stagnation aren’t always accurate, they no doubt comfort the Western elites who generate and heed them, perhaps dreaming that the People’s Republic of China (PRC) will relive Japan’s 1990s misadventures. Many in the 1980s thought that Japan’s industrial and financial heft would surpass that of the US; Ezra Vogel’s Japan as Number One: Lessons for America (Harvard University Press, 1979) was an American bestseller. Then the yen grew too strong (thanks to Washington), the real estate bubble burst and long years of deflation followed, putting an end to such predictions.

China is staunchly independent

This story has little likelihood of repeating itself. China has 11 (…)

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