May 28th, 2012
07:00 AM ET

Fareed's Take: Is China's economy on the verge of a slowdown?

Watch "Fareed Zakaria GPS" Sunday at 10 a.m. and 1 p.m. ET.

There is much speculation these days about power struggles in China in the wake of the ouster of Bo Xilai, the powerful party boss of Chongqing.

China's political system will surely be tested but in the short run, its leaders may have dodged a bullet.

Bo Xilai was a charismatic, Machiavellian leader, who used populism, money, and power to build a political base.

Had he not been brought down – by a series of mistakes, revelations, and bad luck for him – he might well have altered the nature of the technocratic system that now runs China.

In the short run, China might well survive its political crisis. But it faces a more immediate challenge: an economic crisis.

Watch the video above for more about China's economic future or read more in my column at the Washington Post.

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Topics: China • Fareed's Take

soundoff (41 Responses)
  1. Matt A.

    I'm not sure "slowdown" is the word. The most accurate accounts of their economic status tends to come from expats.

    If your stocking commodities in warehouses to the sky, or where their overflowing next to grain commodities, what does that say about industrial and consumer demand. Cities and real estate developments with no signs of economic or human habitation.

    May 28, 2012 at 9:43 am | Reply
    • George Joplin

      Chinese culture sucks. What have they ever done for the world in the last 1000 years? Nothing.

      May 29, 2012 at 3:00 pm | Reply
      • James Kotai

        Don't be mean. They did invent skinning people alive. Not that great of an invention imo.

        May 29, 2012 at 3:11 pm |
      • Marco Hsiao

        Porcelain is invented by Chinese. All paper-making technology is from China.

        June 12, 2012 at 7:01 am |
      • Hasin

        You are moron, learn history before you shame your self. Chauvisme only bring destruction. Please respect the others

        June 26, 2012 at 10:23 am |
      • greg

        gunpowder, modern sailing, just a few things

        July 22, 2012 at 2:01 pm |
    • Tron San

      .

      中國GDP早晚要趕上美國成為世界第一

      中國國防預算也將超過美國

      中國對抗美國的時代會到來

      .

      June 9, 2012 at 6:39 pm | Reply
  2. j. von hettlingen

    China, the world's second biggest economy has experienced its slowest growth for three years. It has been hit by two effects. Firstly the slowdown in the Eurozone is affecting the exports to and investments in China. Secondly property investment in China – amount to 1/8 of GDP – is slowing down too. Ahead of the transition of power in autumn, stability is key in this handover year. In order to keep economy stable China are "moving into stimulus mode" and investing in infrastructure, such as airports and railways, and project for affordable housing en masse. The growth plan for the next 5 years is set at 7,58% instead of 8%. Still enviable enoguh for many in the West. If growth fell to 6% there would be a problem. Interesting enough one sees a capital outflow from China. Chinese are increasingly buying prime properties abroad instead of investing at home.

    May 28, 2012 at 12:39 pm | Reply
  3. JAL

    Based on what Fareed has said, it seems like slowing down is a natural part of the cycle. China should be commended for taking initiative in fighting poverty, while not demanding unrealistic growth forecasts in the long-term.

    May 28, 2012 at 1:18 pm | Reply
    • George Joplin

      China is a poor, misery filled prison.

      May 29, 2012 at 3:01 pm | Reply
    • George Joplin

      China's government should be on trial for crimes against humanity.

      May 29, 2012 at 3:01 pm | Reply
  4. Brave Ahamadi

    Only pple gna hurt by chinas slow economy is filthy sunni paki ..america leaving soon , china will be next partying down with india as they have billions of dollars in import and export ... pakistan is just a hoe china keeps on side to scare states and isreal

    May 28, 2012 at 2:46 pm | Reply
  5. 60minuteman

    China slowing down? Looks like China misses the Americn middle class too.

    May 28, 2012 at 2:47 pm | Reply
  6. jony3322

    The only thing we should care about is when we go shopping we don't have buy made in China. As long as I have to buy made in China, I can see US's economy still in very bad shape and unemployment still a big problem for US.

    May 28, 2012 at 4:36 pm | Reply
    • Amato

      made in China = made in USA

      May 31, 2012 at 10:17 am | Reply
  7. Uber News Network (UNN) - Copyrighted

    Everything is bad in China but everything is hunkory dory in India. LOL!!!! Sounds like CNN an instrument of implementing Yankee foreign policy??? You bet. Here is one for the road

    The only growth left in India is the hair between the legs. Value of rupee has tanked, inflation is in the clouds, stock market has crashed, corruption is rampant, hospitals are burning, people are dying in scores, societal values have rotted, Microsoft and GE are pulling the plug on call centers...Dell and Delta Airlines have almost packed up and shifted the call centers to Canada. Pakistan has opened up Wagah Border to provide food aid for India (Thank you, Pakistan, for helping out).

    May 28, 2012 at 6:09 pm | Reply
  8. Uber News Network (UNN) - Copyrighted

    New, More Dangerous Hindu Extremist Groups Emerge in India

    Christians concerned as rightwing factions splinter to form militant outfits.
    PUNE, India, October 29 (CDN) — After more than a decade of severe persecution, India’s Christian minority is growing increasingly concerned over the mushrooming of newer and deadlier Hindu extremist groups.

    Gone are the days when Christians had to watch out only for the Vishwa Hindu Parishad (World Hindu Council) and its youth wing, Bajrang Dal, which are closely linked with the most influential Hindu extremist umbrella organization, the Rashtriya Swayamsevak Sangh (RSS). With voter support faltering for the RSS’s political wing, the Bharatiya Janata Party (BJP), moderate and extremist sections within the Hindu nationalist movement are blaming each other, and militant splinter groups have emerged.

    Claiming to be breakaway factions of the RSS, new groups with even more extreme ideology are surfacing. The Abhinav Bharat (Pride of India), the Rashtriya Jagran Manch (National Revival Forum), the Sri Ram Sene (Army of god Rama), the Hindu Dharam Sena (Army for Hindu Religion) and the Sanatan Sanstha (Eternal Organization) have launched numerous violent attacks on Christian and Muslim minorities.

    May 28, 2012 at 6:10 pm | Reply
    • counterpoint

      Thanks for a low down on India u stupid fool. All this rant about right wing hindus does not cut it as the whole world is hunting down wanting terrorists in Pakistan a.k.a. terrorist state of pakistan. Hoes take money from states and saudis and chinese (do not know how many fathers are), keep summarily killing minorities and their own women (hudood ordinace), lone ahmadi who earned noble prize had his grave destroyed and their passports denounce ahmadis. I mean pakis are the most advanced self delusional fools in the whole word. They try to keep teaching the whole world values whereas the sole aim of population to exist is to feed the corrupt military whose wet dreams are conquering India and then global domination. That is another thing that except for Punjab, the sindhis, balochis and FATA and NWFA simply hate them and their ilk and rickshaw drives sell kidneys to survive. Go on, loot ur own poor people and send money to swiss banks and ur children to states. Kepp feeding everybody jihand, come early to the border, we will send u to meet ur 72 fast, that is our mission u clowns

      June 6, 2012 at 11:30 am | Reply
  9. Duck Dodgers

    why all the hate for India? You get some bad Curry?

    China's growth is down because it has been artificially inflated. It is still artificially inflated, they are just slowing that down a little bit. If China was to allow the value of the currency to be true rather than manipulate it the way they do, their economy would crash and you would see that their growth was completely based on the fact that they had artificially cheap exports.

    May 29, 2012 at 1:03 am | Reply
  10. the truther

    NO. China is an atheist country, it will never slow down. Religious America will soon die

    May 29, 2012 at 1:49 am | Reply
  11. deniz boro

    Time to contemplate after where it can go in full force. Chinese are respectable people if they even export curly bamboo stalks to bring home the bacon.

    May 29, 2012 at 5:43 am | Reply
  12. palintwit

    When Sarah Palin was asked to weigh in on this she stated that she likes the egg foo yung.

    May 29, 2012 at 9:57 am | Reply
  13. 100% ETHIO

    China never had a War. How the slowdown occurred?

    May 29, 2012 at 7:48 pm | Reply
  14. johnny

    There will be NO hard, soft or any sort of landings for China everyone is wildly guessing.

    I think China is shifting it's focus on a new strategy. Which is abandoning dependence on its exports to the West and Europe, while concentrating on expanding its trade agreements throughout Asia and the emerging countries like everyone is doing.

    Chinese people will prosper, earn higher salaries and become the mass consumers for China home made products. This is easily achievable for them because of the sheer size of its population. And it can be furher enhanced if China reverses its one child policy, and increase its population to 2 billion. But before that can happen China will have to expand its agriculture and other food productions to feed this amazing number of people.

    May 29, 2012 at 9:00 pm | Reply
    • johnny

      Meanwhile China will continue to invest in other countries like US, to earn even more foreign currencies for their national reserves.

      May 29, 2012 at 9:05 pm | Reply
      • johnny

        China may be content once they arrived at 5-6% GDP growth , after achieving political and economic stability domestically.

        It will be that perfect takeoff – for a non-stoppable orbit around the world .

        So, people should stop hoping for any kind of crash landing for China.

        May 29, 2012 at 9:56 pm |
  15. Cragglesmacks

    Not surprising, their system limits their growth. Their economy per person is still very weak well within the developing country margin.

    May 29, 2012 at 9:10 pm | Reply
  16. johnny

    China's political maturing is somewhat less Hollywood than America's. It is less dramatic than the impeachment of Nixon and the almost impeachment of Clinton.

    And of course, there is that political, symbolic, dramatic, shoe in the face bullet of Bush Jr.

    May 29, 2012 at 9:43 pm | Reply
  17. tanseetee

    The only things that are possibly crasing are Eu and US economies !

    How can anyone who donteven know what is happening in China is predictings a crash landing. Gawd.

    If there is any crash landing it will be the property business in SHANGHAI. The rest of China's emerging states are doing better than Europe and America. These states are prospering and will contribute to China's GDP growth. For the next 20 years.

    June 12, 2012 at 6:39 am | Reply
  18. tanseetee

    The only things that are possibly crashing are Eu and US economies !

    How can anyone who donteven know what is happening in China is predictings a crash landing. Gawd.

    If there is any crash landing it will be the property business in SHANGHAI. The rest of China's emerging states are doing better than Europe and America. These states are prospering and will contribute to China's GDP growth. For the next 20 years.

    June 12, 2012 at 6:40 am | Reply
  19. Marco Hsiao

    [ Great China is emerging and unstoppable ]

    The Republic of China (ROC Taiwan), Hong Kong, Singapore and Mainland China (PRC) have same culture and language. All Taiwan's passport and ID are printed as "Republic of China". Possibly after the per capita income of Mainland China is same with Republic of China, then Mainland China will slow down on her economic growth.

    China has longest (lasting) history, and her history record is preserved well; the civilization has passed several difficult and prosperous periods. Now the living standard and world position both are upgrading, so Chinese are becoming happier. Why clash?

    South Korea and ROC Taiwan are "slow down", but is still growing, at least is faster than many countries. After 2025 China (Mainland China + ROC Taiwan + Hong Kong) will surpass the US on GDP and military forever. In 2025 Singapore will have highest per capita income on the earth. That is the future.

    June 12, 2012 at 7:30 am | Reply
  20. Marco Hsiao

    Even Mainland China's economic growth is 5 %; it is not a crisis certainly. It is a cheerful and healthy growth. You could not always run, rest is important for next run.

    Of course, Mainland China's economic growth will slow down in the future; it will happen after China's GDP is 4 times bigger than the US.

    June 13, 2012 at 5:41 am | Reply
  21. anuthng

    You told very well.Thanks. I believe what your mentioned.

    July 9, 2012 at 5:56 pm | Reply
  22. anuthng

    Chinese never become as US due to China has lack of moral. Politiclly China so delay on world. Because they don't have right to express. Even many meddle east has to right to choose their leader but China don't have

    July 9, 2012 at 6:00 pm | Reply
  23. panda

    What you don't want done to yourself, do not do to others.

    Yah! This is the policy of China flashed back 5,000 years ago.

    China, please save the world from the abyss!!!

    July 10, 2012 at 11:53 pm | Reply
    • 流浪鱼

      china is really abyss!

      July 22, 2012 at 4:23 pm | Reply
  24. johnny

    Whether its stop at one, two or three, these are options China once they are economically ready for it.. It will take time. Like they always say Rome wasnt built in a day.

    China current economic, and soon political, transformation, is truly awesome and should be an inspiration to all underdeveloped nations like Burma and North Korea to change their political course.

    Asia , Africa and the emerging countries are looking to China than America.

    I think its a shame that many Republican politicians do not want to work peacefully with China. These myopic politicians are still in never never land. They continue to believe in their own invisible greatness, refusing to believe America's dominance politically or economically is over.

    US can become 3rd place at best.

    America is a great country, but run by many incompetent politicians who are bankrupting their cities enmasse.

    July 26, 2012 at 12:07 am | Reply
  25. Brave Ahamadi

    jiski thali main khao usi main ched karo .. its in ur blood son .. filthy sunni paki

    May 28, 2012 at 2:43 pm | Reply
  26. mario negovetich

    I'm a USA citizen trying to convince the government to adopt a low enforcing all pens companies to offer at list a "GREEN" pen. From America I never found anybody interested. From China I got offer to buy MYGREENPEN T.M.
    this show me China is more agressive when business are at at stake, and the same apply to everything China do.
    China could have a slowdouwn but of modest consequenses to the Nation in general.
    Regards, Mario Negovetich. { USA discard every year 240.000.000. plastic pens, a crime agaist the environment. }

    May 29, 2012 at 6:52 am | Reply
  27. Jay

    saeed,you are a moron.If any one should be nuked,it should be people like you who live in thisworld..Better yet you and alike are dong a very well kiliing each other in the middle east.

    July 17, 2012 at 9:33 am | Reply

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