China’s economy weakens, then gets even worse and now there’s a global shipping crisis. What’s next?

China's Supply Line
China’s Supply Line

The world is waking up to the fact that maybe being dependent upon China for its goods is not such a good idea.

In 2019 at about the same time the US was closing on the trade deals with China, COVID emerged in China.

In 2019 China’s economy was also beginning to slow down. COVID didn’t help China but it didn’t help the world economy as well.

Now a year later, China is unable to cope with the cost of electricity.  This is causing power outages across China and an estimated 40% reduction in manufacturing in the country. 

The country simply cannot afford the price of coal to keep its factories running at full capacity.  This is leading to fewer goods being produced and shortages around the world.

People are waking up to the fact that the model of being dependent upon other countries like China for a country’s essential or nonessential goods is not a very good idea.  Global supply chains need reliability.

China is not solely to blame.  President Trump attempted to get companies out of China and back to the US and in other Asian countries.  But the leaders of businesses like the cheap labor in China.  They care more about this than their country or the workers in the US.

Now here is China with another significant downturn in its economy and the world waits for its products.

Over-dependence on any country is a bad idea and allows countries like China to weaponize their supply chains.

China’s Economy Weakens Then Comes COVID, Now China’s Economy is Worse and There’s a Global Shipping Crisis, What’s Next? — The Gateway Pundit



Categories: Trade & Investment

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