China 2013: Boom Or Bust?

Image by: Tom Thai
By Steven Morrison II

Big Red has been an economic powerhouse for decades, especially when it comes to cheap manufacturing and the seemingly endless supply of investment cash it has on hand. But there are some troubles ahead for China as the working class is growing tired of poor working conditions, low pay and a heavy-handed government.

It is hard to erase visions of Apple product assemblers jumping to their deaths at the Foxconn plant, as was widely reported this year.

Additionally, those who have money in China are asking for more freedom, always a sticking point in a country that controls nearly every facet of life. And let’s not forget that the real estate market has severely tanked, its bubble softly bursting under the guidance of a government hell bent on keeping the housing market from getting out of control.

All of this has cooled China’s growth over the past year. But analysts think that 2013 will be a rebound year, but not much of one. As previously reported by Danjur, China’s growth rate in 2011 was a healthy 9.3%. That number drastically to 7.7% in 2012. It is expected that the communist country’s growth for 2013 will be around 8.3%. Talk about a roller coaster.

So is that a boom or a bust? Neither. Consider 2013 a middle-of-the-road year for the Asian powerhouse. While investors should be very cautious, there are still a few bright spots, namely the liberalization of some of the country’s economic sectors. But troubles around the world continue to be a drag on the Chinese economy as orders for goods have fallen, adding extra pressure on the country’s leaders to tweak the system further. And their moves haven’t always been seen as brilliant.

As a result, the outlook for China in 2013 is mild, but with a chance of showers. There are great places to put your money in 2013, but China just doesn’t appear to be one of them.