Is a coup d'etat brewing in China?

"The body politic of China is terminally ill. Only a transplant can
save the body politic, and the only other system on offer is
competitive democracy," Garside, a former diplomat, told Epoch
TV’s "China Insider" program on Jan. 31 (https://bit.ly/3HROrot).
China’s equity benchmark slid into a bear market
(https://yhoo.it/3sGdHHF) while the yuan tumbled the most in
seven months, as the Federal Reserve’s hawkish comments added
to investor concerns over the nation’s regulatory headwinds.
The CSI 300 Index closed 2% lower on 22 jan 2022, taking losses
from a peak in February to more than 20%. The drop came despite
many strategists turning more positive on Chinese stocks, betting
the country’s monetary easing will benefit its equities. The yuan fell
as much as 0.7%, the most since June.
On Jan. 25, 2022, China’s SSE Composite Index fell below 3,500
points to 3,433.06, a 2.58 percent drop—the biggest one-day drop in
18 months. The SZSE Component Index on the Shenzhen Stock
Exchange fell 2.83 percent to 13,683.89. The Chinext Price Index
(399006.SZ) fell 2.67 percent to below 3,000 for the first time since
May 14, 2021. A-shares, ordinary renminbi shares, also set a record
for the first time with the number of declining stocks exceeding
4,000 in a single day. According to Wind, 4,399.
China’s private sector has become powerful and autonomous, according
to Garside. This has been putting pressure on the CCP, causing anxiety
among the country’s leadership (https://bit.ly/3Jow6zq).
Early on Jan. 26, Chinese state media Securities Daily urged
institutional investors to rescue (https://bit.ly/3uRKfkI) the A-share
market. The article began by comparing the Chinese and US markets,
asking why stock market A is falling when China's upside potential
is higher than that of the US.
"Alibaba raised $24 billion on the New York Stock Exchange; 248
other companies have raised billions of dollars out of the control of
the Communist Party, beyond their capital exchange control, beyond
their political control," he noted.
"Those companies can use that money to turn round and buy politicians
in China, and rivals to Xi Jinping," he added.
When Xi came to power in 2013, he decided to "double down on the
CCP’s totalitarian rule", instead of restarting the liberalization of the
economy, according to the author.
"But here we are 10 years later, he and his closest allies clearly are
afraid of the power and autonomy which the private sector has
achieved,"he said.
What the CCP did to Hong Kong is an indicator of the CCP’s weakness,
according to Garside.
"Tiny Hong Kong 7.4 million people, but very attached to the rule of
law and wanting democracy. And they’re the mighty Beijing, Communist
Party, controlling supposedly 1.4 billion people," said he.
nother factor that could empower officials to launch a coup is the
declining property sector, said Garside.
The regime has been "relying on land sales to finance themselves for
years, and now the price of land has plummeted," he said, noting that
around 25 percent of China’s gross domestic product comes from the
property sector.
But now this sector is "unraveling," Garside said, citing the growing
crisis faced by Evergrande, the world’s most indebted property firm
with more than $300 billion in liabilities.
The company, along with several other Chinese real estate developers,
failed to meet debt interest payments in 2021. The developers were
then being forced to sell their assets at lower prices. But due to a lack
of buyers, Evergrande’s shares and the property market prices in
general decreased significantly.