In the face of increasing international criticism and the approaching 20th Party Congress, China is gradually reopening to keep up with the rest of the world.
Economic crisis, state-owned replace private enterprises.
According to data from the Wall Street Journal’s analysis, Zhang claimed that the reform of China’s real estate market over the last year had favored state-owned investors.
The viability of private firms has been seriously harmed by worldwide bond defaults and a drop in sales.
Evergrande, the world’s most indebted property company, with more than $300 billion in total liabilities, and Sunac China Holdings, one of the largest Chinese property companies reneging on its obligations amid a record-breaking wave of missed payments, are just two recent examples.
According to Zhang, China’s real estate market is currently experiencing a downturn, with real estate sales in many places may drop to 80-85%.
The share of SOEs acquiring land and houses is minimal in the entire real estate industry, only about 15 to 20%. However, now that private firms are experiencing difficulty, going bankrupt, or defaulting, only individuals with money can purchase this land.
Although SOEs are experiencing a reduction in property sales and housing, it isn’t as bad as their peers who don’t have a post-government agency contradiction.
Zhang quotes Howe Chung Wan, Asia head of fixed income at Global Lead Investment Firm in Singapore. According to Howe, most survivors are developers with strong financial standing and ties to state-owned industries.
The professor then added that SOEs could receive preferential loans from the government. Furthermore, businesses in financial distress will sell their assets at a reduced price. At this time, state-owned enterprises can easily intrude on the private-sector territory.
Real estate prices will decline, but stocks and cryptocurrencies will also, implying that less money will circulate in society.
Furthermore, substantial foreign investment capital will leave the country, and the SOEs will purchase their companies and manufacturing lines.
As a result, Zhang believes this is an observable circumstance that may develop in the post-epidemic period and benefit economic assistance to the government.
Political control over society becomes tighter
In China, the health code is currently in use, and it can track people’s locations at any time and from any site. According to Zhang, the CCP government won’t let this strategy slip out of its hand.
According to Zhang, the administration is continuously looking to consolidate power. He used the 2008 Olympic Games to cite how the government established an “Olympic security model,” constructing a closed network around the Beijing-Tianjin-Hebei area.
The reason for sealing these areas was to maintain calm and assure the safety of the Olympics. But after the Olympics, this paradigm of ensuring Olympic stability was extended to the entire country.
In other words, once the government starts to have a new control method, it will not loosen even one bit.
The government is detaining people, keeping them in cabins, blocking doors, breaking into houses, and tracking who is with whom at any given time and place in epidemic prevention.
He stated that CCP would undoubtedly apply the virus pandemic measures to other societal issues.
As a result, Chinese people’s actual freedom is systematically destroyed. People have less leverage against the government when they lose freedom.
When one’s right to freedom of speech is taken away, their will to speak the truth and express thoughts are lost.
He believes many individuals will be pessimistic about his findings. But he thinks that these are events and everything that every citizen is going through right now is due to their previous decisions. People gave up their freedom and stopped battling the CCP.
Any party considered a danger to the CCP’s power is constantly suppressed, whether interested in politics or involved in it.