“Bad news”: how the crisis in China could hit the global economy

The global economy is threatened by the growing crisis in China.

This is reported by Forbes.

According to experts, the world economy is highly dependent on the development of such large countries as China.

Since China for a long time provided the demand for raw materials and energy to those who depend on their exports.

Now the growth rate of the Chinese economy has dropped sharply due to the pandemic and the impending bankruptcy of the giant company Evergrande.

This year, China’s GDP has grown by only 4.9%, while last year the figure was 7.9%.

“China is the largest world economy, respectively, it is one of the key consumers of energy resources – oil, coal, electricity, but with unstable demand caused by the continued spread of coronavirus infection, as well as a natural shortage of energy resources, a slowdown in the PRC economy as a whole is expected,” says analyst Alexei Antonov.

According to some experts, this is only the beginning of the economic crisis in China and the world; humanity will feel the greater impact from this in the fourth quarter.

Economists say this is bad news for the global economy, superimposed on the EU’s energy crisis.

The reason is that China is an important driver of energy and metals prices, so a slowdown in the Chinese economy will be a bad signal for producers of ore and other raw materials.

“This can make a significant contribution to global inflation due to the fact that many supply chains are disrupted, prices for goods will rise. And inflation is a serious enemy of the world economy,” the expert emphasized.

Earlier, Segodnya together with experts examined the reasons for the collapse of the giant in the Chinese real estate market – Evergrande and found out that its default could harm Ukraine.

The company is in a truly dire position as it has begun to sell off its major assets.