What's going on?

Projections out on Tuesday suggested that China�s growth will fall behind the rest of Asia for the first time in over three decades.

What does this mean?

In the immediate wake of Covid, China seemed to be at the forefront of the world�s recovery from the pandemic. But a lot has changed since then: the country�s strict zero-Covid approach � which depends on snap lockdowns and mass testing � has restricted movement and left consumer activity pretty depressed. And when you consider too that China�s all-important property sector � which makes up about 30% of the economy � is taking a worse bruising than Olivia Wilde�s “Don’t Worry Darling”, it�s no wonder the World Bank now predicts the Chinese economy will grow just 2.8% this year. For the rest of Asia, though, things look comparatively rosy: high commodity prices (good news for exporters) and a strong rebound in domestic demand mean it’s expected to grow by a healthy 5.3% this year.

Why should I care?

Zooming in: The world�s watching its wallet.
China�s woes don�t end there. You see, with recession fears (and in some cases, actual, full-blown recessions) setting in, China�s exports are taking a hit. That�s worrying for a country that typically relies on exports to fuel growth, but the numbers don�t lie: Shanghai�s port processed 8% less cargo this August compared to last August � a dropoff that�s contributed to plunging shipping costs from China, which are now at their lowest in over two years (tweet this).

The bigger picture: A silver lining for everyone else.
It�s a dog-eat-dog world out there, and China�s difficulties present the country�s trading partners with plenty of opportunities � specifically the countries China exports to. See, falling demand should ease some of the congestion that�s been plaguing global supply chains, while lower shipping costs could help to cool inflation globally too.