China's Silent Crisis: Overcapacity, Debt, and Systemic Risks to the Global Economy
China's Silent Crisis: Overcapacity, Debt, and Systemic Risks to the Global Economy China’s economy, while projecting resilience with ~5% GDP growth in 2025, faces a deepening crisis driven by overcapacity in real estate, cement, steel, and coal, alongside a collapsing domestic demand and mounting debt (305% of GDP). The ripple effects devastate secondary industries (e.g., building materials, autos) and tertiary sectors (e.g., real estate services), with non-performing loans (NPLs) rising to 2-3% and credit growth slowing to 8.2%. Exports and the Belt and Road Initiative (BRI) fail to absorb excess capacity, constrained by tariffs and $400B in risky loans. This under-the-radar crisis poses systemic risks, particularly for the Global South, facing trade disruptions and debt defaults. Beijing’s state-led interventions—fiscal stimulus, tech investments—buy time but mask structural flaws. Without rebalancing to consumption, China risks a 3-4% growth slowdown by 2030, threatening glob...