China’s economic downturn is visible to the naked eye, with Shanghai also revealing a financial black hole. Social observers believe that China’s economy continues to deteriorate, triggering a chain reaction and pushing Chinese society to a critical point.
Shanghai lawyer Dai Peiqing, in a recent interview with Dajiyuan, shared a story about a friend in Songjiang District who was a big boss. The friend invested 6 million yuan in renovating three youth apartments in the area, but after the workers left within a few years, he faced financial ruin as the properties remained unoccupied. This case reflects the mass exodus of people from districts like Songjiang, leading to a stagnant rental market.
Songjiang District, once Shanghai’s main industrial area, now symbolizes the decline of the city’s manufacturing sector. The landscape around areas like Jin Qiao Biyun International in Pudong, which used to house many foreigners, now resembles a deserted scene with bars replacing the bustling atmosphere.
The decline in Shanghai’s economy is affecting various sectors, from factory closures and foreign company exits to impacts on the rental market, domestic service industry, electricians, and delivery services.
The exodus of wealthy individuals and assets from Shanghai, especially after the city’s lockdown, has intensified. Reports indicate a significant increase in millionaires leaving China for the past decade, highlighting a general loss of confidence in the country’s economic prospects.
Following the COVID-19 pandemic, particularly Shanghai’s lockdown measures, a massive migration of wealthy individuals has occurred, resulting in a significant outflow of assets. Investment immigration firm Henley & Partners based in the UK forecasts a substantial outflow of millionaires from China this year, setting a record surpassing previous years.
Dai Peiqing pointed out that aside from the pandemic, current economic challenges are aggravated by trade sanctions and irregular business practices. These issues, coupled with factory relocations to Southeast Asia, have led to a chaotic economic landscape in China.
The financial woes in Shanghai are not without substance, as economic data from various provinces indicate significant budget deficits. Despite Shanghai being one of China’s most prosperous cities, it has long been supporting other provinces financially.
The economic downturn has led to a chain reaction, affecting various aspects of society. Factory closures have reduced electricity consumption, impacting coal sales and mining activities, a trend seen in Anhui Province and other regions.
The economic downturn has also affected everyday life, with small businesses struggling and a noticeable decline in consumer spending. Discontent among the populace has risen significantly, reflecting a deteriorating social environment.
In the face of these severe economic conditions, instances of fraud and unethical practices have increased, even within the legal profession. Lawyers and journalists are reportedly engaging in fraudulent activities, further highlighting the breakdown of ethical standards in society.
In such dire economic circumstances, the legal profession has also become increasingly commercialized, with the rise of online platforms and unethical practices becoming more common.
The signs of a collapsing economy are apparent, with businesses closing down, citizens losing jobs, and widespread financial struggles becoming the daily norm. The mounting challenges faced by Shanghai and other regions underscore the urgent need for effective economic reforms to avert a deeper crisis.