You seem very knowledgeable about China. Just wondering what you think about the future of the Chinese economy.
I've done business directly with Chinese entities since 2000 and have visited their factories and government facilities quite a number of times so I have developed a perspective that has served me well. A couple of things you should know about their economy:
1) The typical small business (less than about 500 employees) is leveraged up the wahoo. Government loans at 0-1% interest are the primary funding for "desired" industries. In return for this free money the government in essence owns you and definitely micromanages you.
2) Most Chinese businesses operate on a very low corporate profit margin- in fact less than 5%. The primary business goal is to employ people.
They never factor in money for R&D, new product development, etc. That is why Chinese companies rip off patents and copy everything in sight. They also don't have a cash reserve that is very big. A downturn in the economy and poof they are gone quickly.
3) The Chinese philosophy for gaining control of an industry is to undercut everybody else. But this only works if Beijing gives the company cash to sell at less than market rate, and often at less than cost to manufacture. Once the Chinese take over an industry, quality suffers and ultimately the industry collapses down to nearly nothing because no one invests in anything new and the price keeps getting lowered till there is no profit left. So paying back the government gets very difficult.
The average Chinese company has a lot of debt, a lot of global industries have advanced faster than the Chinese can keep up, and the Chinese government has spent huge sums on other things like military expansion that has sucked the well dry. This virus is about the worst thing that could have happened. I have read conspiracy theories that the Chinese did this on purpose to kill the US economy. Well if so, it's a murder suicide .
My guess, and it's just a guess, is China is going to have a very bad short term future. Trump has hurt them badly with the tariffs (and I am in total agreement because China has tacked on a 27% tariff on my goods since day 1). Add to that the virus has the world now taking a second look at the real cost of doing business with China and you have a recipe for disaster.
As a tech business i have decided to no longer source anything from China and to require 100% payment upfront for anything i sell to them. I have talked to a number of other business owners in the US and was surprised to hear them saying the same thing. So something is up and i will be interested to see how it plays out.