China’s Small- And Medium-Sized Companies Face Imminent Existential Crisis: Survey
On Friday, the Nikkei Asian Review ran a story that contained some rather disconcerting statistics gathered from a joint survey of 1,506 small- and medium-sized businesses in China. The poll was conducted by Tsinghua University and Peking University.
Although pretty much every figure cited in the piece was alarming, the number that perhaps best conveyed the severity of the economic storm bearing down on China's SMEs was the percentage who indicated they could survive longer than three months wi
Glad to see this issue finally being addressed. Could the gravity of coronavirus set off the debtstar collapse? And if so, will the CB’s reaction function go supernova?
And that’s the flaw in the “China will stimulate” argument (credit and tax relief don’t help if you can’t service debt nor have taxable income) and the “its only temporary” argument (a collapsed SME can’t rebound when the epidemic is over, any more than a dead person).
Similar risks in other countries, with much less govt ability to cushion.
How many Chinese families can survive without wages for 1, 3, 6 months? How many American?
If I recall the statistics correctly, 40% of US households couldn’t survive a $500 hit to their budgets. Please confirm or give us the correct number someone
ahhaha, yeah that’s the irony. I almost used that as the punchline, but the situation felt too serious to be amenable to it. Lower- and middle-income Americans are in far worse shape than these Chinese SMEs just in terms of cash on hand. Which is yet another argument for Bernie.
Of course, the difference is that most US households which aren’t just totally bereft have access to at least some form of credit, even if it’s something as punitive as a pay-day loan. Some of those SMEs in China, on the other hand, face actually having to just turn the lights off.