Probably one of the most bizarre outcomes of our political process in recent years has been the deterioration of our relationship with China, as we have ignored the significance of the Chinese economy to our own.
Much of the discussion about China has distracted from the fact that the Chinese economy may well be in an accelerating long-term decline, such that it will become a major constraint on our economy. Gone are the days of the China-driven “resources boom” of the Howard era and the supportive role China played in our response to the great financial crisis, helping us to avoid a recession. This year the United States is forecast to grow faster than China for the first time since 1976. The World Bank predicts China’s growth will “slow sharply” this year, to 4.3 per cent, almost a full percentage point below their estimate last December.
Their revision “largely reflects the economic damage caused by Omicron outbreaks…
