Tuesday, December 16, 2008
Will China's Economic Slowdown Bring Political Unrest?
Conventional wisdom has it that China's economy must grow at least 8% to absorb the new workers pouring into its cities. Geoff Dyer in Beijing reports that the World Bank forecasts it will fall short of that next year "as it sharply cut its outlook for the country’s economy." As its economic growth falls from from recent double digit, the People's Republic faces danger as it approaches the thirtieth anniversary of Deng Xiaoping's opening to market forces. Also in the Financial Times, Gideon Rachman comments, "the only recent examples of social unrest in one of the world’s main economies have come there, not in the west. Laid-off workers in factories in southern China have staged protests that had to be contained by riot police. There have also been strikes and violent protests by taxi drivers in some cities across the country. The notion that the Chinese economy has so much momentum that it has 'decoupled' from the US looks like a myth."