REVEALED: 5 things that might destroy China!
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Rare earths exports could stop
China accounts for 97% of global rare earth production and is said to have 87% of the world's rare earth deposits but in an attempt to curb pollution and protecting its resources, the country began to slow exports of the minerals.
According to critics, China made this move to draw manufacturing to the country, because the restrictions only extended to the rare earth minerals themselves, not products containing rare earths.
This could impact companies around the world since they are used in everything from wind turbines to smartphones.
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China has set an inflation target of 3.5% and policymakers watch inflation closely but consumer prices have been picking up again and policymakers would not want to see a surge in CPI for a few key reasons.
Rising consumer prices without an accompanying rise in wages could cause civil unrest and policymakers would like to avoid this at all costs. Food prices make up a bigger part of the nation's inflation basket than in developed markets. As the economy slows, a rise in consumer prices limits the ability of the central bank to loosen monetary policy and support growth.
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We've seen photos of Chinese cities covered in smog. China has admitted that pollution has caused 'cancer villages’. Pollution, through illness, death, and loss of productivity, costs the economy over $100 billion a year. China is set to spend hundreds of billions of dollars to lower pollution and is handing out the death penalty to the worst offenders.
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China and Japan could go to war
The last year saw Sino-Japanese relations deteriorate as the dispute over the Senkaku/Diaoyu islands began to heat up. While the two nations have avoided an outright war, some say this could be a possibility.
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Corruption could cause the collapse of the Party and state
Chinese policymakers are working overtime to ensure that locals know they are serious about tackling corruption. They have cracked down on gift giving and are trying to make an example of corrupt policymakers like former Chongquing party chief Bo Xilai.