Does China still have a functioning business model? This question comes up more and more these days. Xi Jinping should avoid five follies because they endanger his rule.

By far the most unsuccessful head of government these days lives in Beijing and is called Xi Jinping. He is risking pretty much everything that his predecessors had built: from the internal Chinese private sector to the export model that is admired by all.

The earlier respect has given way to fear, and fear has now given way to doubts as to whether this China still has a functioning business model at all.

There are five follies that the autocratic ruler has to be accused of because they ultimately endanger his rule:

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In addition, there is the dynamic development of viruses, which, due to their anti-authoritarian DNA, do not care about the orders of the CCP either. The result is growing repression by the state, which is being matched by growing popular resentment.

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The economically liberal motto of the reformer – “It doesn’t matter whether the cat is white or black, the main thing is that it catches mice” – was replaced by the old dictum of the cadres: “The party is always right.”

Successful founders like Alibaba’s Jack Ma are suddenly disappearing from the scene. Companies like the dispatcher DiDi or the payment service Alipay are being dismantled by the state because they think they are too powerful.

The end of the story: The regulated economy gradually stops growing. The proud 15 percent growth rates that once helped lift millions of Chinese out of poverty are a thing of the past.

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Apparently, the CP leadership has forgotten an important lesson of recent history: only the integration of China into all Western institutions, even endowed with veto power in the United Nations, created the conditions for today’s prosperity.

According to Kevin Rudd in his book “The Avoidable War”, membership of the WTO in 2001 was “a game-changing opportunity for the global market” for the People’s Republic of China.

Now the game clock is running backwards for the Chinese. America downgraded the country from partner to rival in its official security doctrine.

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The former heads of government of China had a great, basically inconceivable diplomatic success to show for themselves. Because the victory of the communist revolution in China was accompanied by state recognition of the new rulers in Beijing and the secession of the old government, which now pitched its tents in Taiwan.

Almost all Western countries, led by the USA, accepted the one-China policy, de facto depriving the government in Taiwan of its legitimacy. Today, only 13 of the 193 United Nations states recognize the existence of democratic Taiwan as a separate nation.

The increasing number of Chinese military maneuvers off the coast of Taiwan and the expansion of uninhabited islands into maritime bases are forcing the West ever closer together into an anti-China coalition.

US President Biden recently said on the television program “60 Minutes” that an occupation of Taiwan would immediately result in the United States entering the war.

Gabor Steingart is one of the best-known journalists in the country. He publishes the newsletter The Pioneer Briefing. The podcast of the same name is Germany’s leading daily podcast for politics and business. Since May 2020, Steingart has been working with his editorial staff on the ship “The Pioneer One”. Before founding Media Pioneer, Steingart was, among other things, Chairman of the Management Board of the Handelsblatt Media Group. You can subscribe to his free newsletter here.

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The successor had to be appointed early, so that a peaceful transfer of power took place from Jiang Zemin to Hu Jintao and later from Hu Jintao to Xi Jinping.

Xi Jinping, who had himself declared leader for life, has thus dismantled the valve of a peaceful handover from one generation to the next generation, but also from one faction to the other faction.

Its most important instrument of rule is not increasing prosperity, but increasing repression. This distinguishes him from all post-Mao rulers. He is closer to Stalin than Deng Xiaoping.

Conclusion: the pressure in the Chinese cauldron is increasing. The Shanghai Composite’s fall — down 50 percent from its peak — is just the storm bird warning of the brewing storm.

High energy costs, inflation: Many Germans are currently suffering from money worries. One topic that has not been discussed much so far are so-called index leases.

They allow the landlord to increase the basic rent each year as much as the consumer price index has risen. Currently, an increase of 10.4 percent would be possible.

We want to devote ourselves to the topic of index rental contracts and draw on the experiences of our readers. Do you have an index lease? If so, are you concerned about potential increases? Or did it already exist? How did you react?

Write us your story to mein-bericht@focus.de, preferably with your full name, place of residence and a telephone number for queries. We will publish some of the submissions.