In the China 2024 report published last year, the authors captured China’s prospects with the phrase “a vexing year ahead for China.” The report forecast an overall erosion of trust in China, intensifying economic headwinds, continuous political purges, widening social discontent, a deteriorating geopolitical environment, and unremitting climate events in 2024. This forecast has borne fruit.
Under President Xi Jinping’s iron grip, the party-state reigned supreme. Yet, under its appearance of control, China found itself mired in continued loss of investor confidence, a deepening real estate crisis, ballooning local government debt, a volatile stock market, deflationary pressures, and increasing popular discontent. Bureaucratic inertia, social ennui, and political distrust—especially among the urban middle class—percolated beneath the surface. China also faced heightened geopolitical tensions, especially with the United States and its allies, and increasing economic decoupling, particularly in technology. As relations with the West soured, Beijing strengthened its ties with the Global South.
But global economic challenges, such as inflation and slowing growth, put downward pressure on China’s exports, further burdening its economy.
