Manufacturing Collapses as Tariffs Hit Hard
March 2025, has devastated China’s manufacturing sector. As 145% tariffs on China take effect, China’s manufacturing sector has seen a decline of international orders, primarily from the U.S. decrease by 90%. Hardest hit are the clothing, electronics, and small kitchen appliance sectors. The tariffs are causing a de-coupling of trade between the U.S. and China. A complete de-coupling would be catastrophic for China, which could result in over 300 million job layoffs.
The CCP Does Not Care About Its People
The CCP is retaliating by imposing it’s own 125% tariffs on the U.S. However, there is a fatal flaw in the CCP’s thinking. They think by playing hard ball with the U.S. that it will give them the upper hand in the trade war. However, we’ve already seen cracks in this as China has already reduced many tariffs on imported U.S. goods to 0%. These include aircraft engines, semi-conductors, and ethylene (for making plastics). However, the CCP says that it is not negotiating with the U.S. at all. If that was the case how did the tariffs on these products get reduced? The CCP has a core belief that it must fight the U.S. at all costs. Including bankrupting and starving its citizens. This was on full display during the CCP’s zero covid lockdowns. And with so many workers becoming unemployed overnight, the people of china are becoming restless. Protests are errupting all over China as working demand wages for work already performed. But the issue is that many of the owners have fled their businesses leaving the workers with no ability to get their deserved wages.
The Tsunami of the CCP's Economic Disasters
With the collapse of China’s real estate market, the closure of factories, environmental disasters, crack downs on private companies, constantly changing banking regulations, policy’s that hurt foreign investment, China is on the brink of total economic and political failure. What’s even more alarming is there are no quick fixes. Even if China does negotiate more favorable tariffs for the U.S., many companies have already moved their supply chains out of China, ane they’re not coming back. As Vietnam’s GDP surges, China’s GDP is shrinking rapidly. Along with a shrinking GDP is the deflationary death spiral that China is experiencing. All of the decisions made by the CCP, and we’re primarily talking about Xi Jing Ping, have sent China into an economic armageddon. What’s more is that the CCP propaganda machine is in full swing. It’s even comparing the CCP to Mao Zedong. Yes THAT Mao Zedong who starved 15 million people to death (and FIA is being conservative on the estimated number of deaths).
Can China Save Itself?
At this point economists believe that complete recovery for China is not possible. There are several reasons. First the one child policy means that there are now more older people than younger people in China. Many of the youth have embraced the “Bai Lan” movement which translates to “lie flat”. Chinese youth are experiencing a high unemployment rate. Some economists estimate this rate to be 50%. 1.2 million college graduates will be entering the China workforce in 2025, but the previous classes of 2023, and 2024 remain mostly unemployed, or have taken jobs in the highly oversaturated ride share and meal delivery services. Without a sustainable youth workforce, there will be not social income to provide for the elderly. It is safe to say the the world of the CCP’s authoritarian and brutal dictatorship, the roosters have come home to roost.