to 7 % in 2020 . During this period the investments in factory production , construction sector activities , retail trade sectors etc . declined . The construction sector of China provides employment to huge number of people and due to decline in this sector lakhs of people of China became unemployed . According to the document of the 14 th Five years plan ( 2020-2025 ) of China , the rate of unemployment reached to 5.2 %, which was 4.09 % in 2014 . Likewise , the rate of inflation has also increased in China . It was 1.99 % in 2014 which increased to 2.39 % in 2020 . The atmosphere of ‘ doing businesses ’ has also deteriorated in China , so the rate of bankruptcy has increased . According to the data , given by the Supreme People ’ s Court of China , about 2000 cases of bankruptcy used to come to the court yearly up to 2014 , but in 2014 the number of such cases increased to 18000 .
It is clear from the above description that , the condition of Chinese economy began to deteriorate after 2010 and the rate of growth of economy started to fall since 2011 .
There are three main reasons for fall of the rate of growth of Chinese economy in 2021:1 ) the falll of Real Estate , 2 ) Power cuts and 3 ) crisis in the Tech and Gaming Industries . Let us discuss these causes in details : 1 . Fall of Real Estate
About one-fourth of the GDP of China comes from Real Estate . Recently , the Government of China has enacted a law for the Real Estate . The Law has been implemented , which prevented immovable property developers to take more loans . Besides , the Chinese administration has begun to enquire effectively the accounts and transactions of financial institutions and shadow bankers , who were renewing / upgrading the shortterm loans of real estate developers . Due to these steps taken by the Chinese government , the crisis of the Real Estate sector deepened . The Giant Real Estate company ‘ Evergrande ’ in total has a liability of 305 billion Dollars , which includes bank loans , 10 short term borrowings and suppliers credit . Thus Evergrande , the top seller developer , turned into one of the top debtor company . With the hardening of debt rules by the Central Bank of China , the existence of the Evergrande company is in danger .
It is to note that the actual financial crisis of the Evergrande group is the result of heavy and aggressive borrowings since many years . Taking loans in huge amounts , the company has expanded its trading activities . The company has developed its activities in 280 cities and working on more than 1300 projects , it has become one of the best Real Estate developers in China . The company has extended much in Wealth management , Theme parks , and sealed bottle water , Electric cars , Goods on rent , Dairy products and other activities . The company is the owner of the most popular Football club of China . But , since the sale of properties has come down in China , the economic situation of the company has deteriorated . Now more than 800 projects of this company are unfinished , and it is not able to pay the bonds on due dates . And since the suppliers and investors of this company are waiting for the payments of their bills , the company has been facing their anger . The Evergrande group has been trying to sell their properties to get rid of this situation . But the company is not getting success in this move . As a result , the employees and workers of the Real Estate companies of China including about 2 lakhs employees of the Evergrande company seems very anxious about their future . Most of the analysts believe that the crisis of Evergrande Company will not be unmanageable and soon the Chinese government will announce an effective plan to save the company .
2 . Power Cut :
Chinese government is not supplying coal according to the needs of power production centers , that ’ s why the production of electricity is less . China had decided to control power , which it has not achieved in the first six months of 2021 . Due to this power cut , the manufacturing industry of China has been much affected . Power blackout is now not abnormal , which it was , during socialist China . Now power is not supplied in many areas for hours , particularly , in the eastern part of the ‘ Industrial hub ’ of China . The problem of power has become very serious , affecting thousands of factories badly . To fulfill the increasing demands of electricity in some strategic areas , and to honor the promises on climate change , Chinese government is reducing the supply of electricity in some areas creating negative impact on industrial production . It is noteworthy that the contribution of Industrial Production in the GDP of China is 40.5 %
3 . Crisis of Tech and Gaming Industry
The Chinese government has framed new rules for technology and gaming industry , to protect the right of privacy . Under one of the rules , boys under 18 years have been banned to play video games . Their times for playing games have also been limited . According to another rule , the employers of Technology and Gaming companies have been directed to provide more facilities to their employees . Owing to obeying these rules and directions , the cost of Technology and Gaming companies has increased affecting their businesses negatively . The Tech and Gaming Industry business was very developed in China and its contribution to Chinese economy is also significant . Weakening the industry has wrongly affected the economic growth of China .
Economic experts on Chinese economy believe that due to some policy decisions taken by the government , the economy of China is facing economic crisis . According to News Agency , Reuters , the factories of China are facing much loss due to power cut . The industrial sector of China was facing loss due to ‘ Covid-19 ’ epidemic , the power crisis has aggravated the crisis . In such a situation many companies related with
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