{"id":9462,"date":"2025-07-20T02:54:20","date_gmt":"2025-07-20T02:54:20","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/9462\/"},"modified":"2025-07-20T02:54:20","modified_gmt":"2025-07-20T02:54:20","slug":"debt-and-shame-why-millions-in-china-feel-trapped-and-alone-despite-a-strong-economy","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/9462\/","title":{"rendered":"Debt and shame: Why millions in China feel trapped and alone – despite a \u2018strong\u2019 economy"},"content":{"rendered":"

\"Debt Across cities and countryside alike, middle-class families once lauded as China\u2019s growth engine now wrestle with mounting debt, shrinking paychecks, and the erosion of hope.TL;DR: Driving the newsChina’s economy grew at a 5.2% clip in Q2 2025 – faster than forecast and propped up by exports and subsidies. But a deeper look shows a troubling reality: millions of Chinese consumers are drowning in personal debt, clinging to side jobs, and quietly unraveling under financial pressure.Many have stopped spending. Some are documenting their ruin online. Others are considering suicide.\u201cI can only endure. I don\u2019t dare to quit,\u201d Frank Huang, a 28-year-old teacher in Chongzuo, Guangxi, told Reuters. His salary hasn\u2019t been paid in months, and he relies on his parents to survive. \u201cIf I were married with a mortgage, car loan and child, the pressure would be unimaginable.\u201dThe government, on its part, has responded with $42 billion in subsidies and vague promises of reform. But the emotional toll is becoming as destabilizing as the economic one.Why it mattersDebt is no longer just an economic metric in China – it’s a psychological burden reshaping the social fabric.* Over 60 million Chinese adults are in default or behind on payments, according to Gavekal Dragonomics. That\u2019s 5\u20137% of the population over 15.* Household debt has skyrocketed from 11% of GDP in 2006 to over 60% in 2025, nearing rich-world levels.* Social shame around money trouble means many suffer in silence – or fall into what researchers call *shesi*, or \u201csocial death.\u201d \u201cIn China, we generally don\u2019t tell our parents about bad news,\u201d Ms Bai, a former education executive whose business collapsed after the crackdown on tutoring told the Economist. \u201cSo they were very, very affected.\u201d\"-\"The big pictureThe Chinese dream – built on homeownership, job security, and rising wealth – is cracking under pressure.What began as a property-driven middle-class boom now looks like a debt trap:65% of all household loans in China are mortgages, often for properties that have plummeted in value since the real estate crash.Job insecurity is rampant, especially for younger and lower-income workers. State firms are slashing wages, and teachers are going unpaid for months.China\u2019s long-promised shift to a consumption-driven economy is being smothered by inaction and intimidation.\u201cRather than just being short of money, people tend to compare and make choices with more consideration,\u201d Zhan Demi, who used subsidies to upgrade her home appliances – and then immediately cut back, told the New York Times.Between the lines: A culture of silent distress\"China-US\"ChineseBehind the GDP growth and flashy subsidy campaigns is a culture of silent distress.Side hustles are survival, not ambition. Zhang Jinming, an employee at a state-run real estate firm, now delivers food every night to make up for a 24% pay cut. \u201cThere\u2019s just no other way,\u201d he told Reuters.Aggressive debt collectors, known as cuigou or \u201cpressure dogs,\u201d bombard friends and family.Call-blocking is futile. Harassment is constant.Legal options are scarce.Personal bankruptcy laws exist in theory – but only 10% of applications in Shenzhen, the only city with such a law, have been accepted since 2021.The emotional toll is massive. Bai, the ex-entrepreneur, considered suicide after her husband divorced her and she was blacklisted from high-speed trains and hotels.\u201cThe pay cut has put me under huge pressure. Many colleagues have resigned, and I took over their workload,\u201d Zhang told Reuters.Zoom in: The ‘Debt IP’ phenomenonIn a country where discussing personal failure is taboo, some are breaking the silence – for survival.A growing class of micro-influencers is monetizing personal debt on social media. They record their fall from financial grace, detail harassment from collectors, and even mock their own poor decisions.Lily, a young woman in Shanghai who films her debt struggles to make ends meet on social media, owes 30,000 yuan ($4,200) and posts short videos chronicling her situation. \u201cI haven\u2019t hit the big time,\u201d she told the Economist, but others have. Popular accounts now boast hundreds of thousands of followers. \u201cSome people are even competing: \u2018Oh, I\u2019m 10 million in debt, I\u2019m 100 million in debt,\u2019\u201d Lily said.This genre – sometimes dubbed \u201cdebt IP\u201d – is part support group, part spectacle. But it’s also a cry for help that the government isn’t fully addressing.What they\u2019re sayingIn Linquan, a rural county of 1.5 million in eastern China, a teacher who gave only her surname, Yun, said she is now receiving just her basic monthly salary of 3,000 yuan, with the performance-based portion\u2014typically about 16%\u2014”consistently delayed.” \u201cAfter I pay for gas, parking and property management fees, what\u2019s left isn\u2019t enough for groceries,\u201d she told Reuters. \u201cI feel like begging,\u201d she added. \u201cIf it weren\u2019t for my parents, I would starve.\u201dMax Zenglein, Asia-Pacific senior economist at the Conference Board of Asia, describes China as a \u201cdual-speed economy,\u201d marked by strong industrial output but weak consumer spending\u2014two dynamics he says are closely linked. \u201cSome of the economic challenges including low profitability and deflationary pressure are largely driven by continued capacity expansion in the manufacturing and technology sectors,\u201d said Zenglein. As for the ongoing trade war with the US he added, \u201cWhat\u2019s unfolding now is coming back home as a domestic issue.\u201dChinese officials are aware of the growing crisis – but they\u2019re sending mixed signals. \u201cWe are still facing a very severe and complex situation,\u201d Commerce Minister Wang Wentao said. \u201cOur toolbox is plentiful, and we will be fully prepared.\u201dPremier Li Qiang has promised to \u201cexpand domestic demand\u201d and \u201cmake China a megasized consumption powerhouse.\u201dXi Jinping, too, has vowed to \u201cfully unleash\u201d consumer potential. But meaningful structural reforms – like a national personal bankruptcy law or a real welfare safety net – remain stalled.Instead, the government is throwing money at the problem: In 2025, China doubled its subsidy pool to $42 billion, offering up to 20% off home appliances, cars, and smartphones.That program sparked a brief consumption bump – May retail sales jumped 6.4%. But in June, growth slowed to 4.8%, disappointing expectations. Several municipalities, including Chongqing, have already paused the subsidies to avoid budget overruns.Spending deferred, dreams deferredThe social toll of China’s lopsided recovery – strong exports, weak consumption – is visible in everyday decisions:Frank Huang, a teacher in Guangxi, hasn\u2019t been paid in months. \u201cIf I were married with a mortgage, car loan and child, the pressure would be unimaginable,\u201d he told Reuters.Another teacher in Linquan says her performance bonuses are delayed. \u201cAfter I pay for gas, parking and property management fees, what\u2019s left isn\u2019t enough for groceries,\u201d she said.Job seekers like Huang Tingting now face fierce competition. She quit her waitress job in April and hasn\u2019t found another since June. \u201cThis year is worse than last year,\u201d she said.Even those benefiting from subsidies are cautious. Coffee is being brewed at home. Rent payments take priority over outings. And families are saving more – not spending more.What\u2019s nextA personal bankruptcy law might offer relief, but only Shenzhen has a version in place-and courts reject 90% of applications. Meanwhile, online loan sharks thrive in the legal gray zones, and structural reforms to support household consumption remain sluggish. According to Capital Economics, consumer prices fell for four consecutive months this year, a warning sign of deepening deflation.Even growth data is under question. Some analysts, like Zichun Huang at Capital Economics, estimate actual GDP growth could be closer to 3.5% for 2025-not the officially reported 5.2%.For now, Beijing is vowing more stimulus and regulatory tightening, but consumer sentiment remains low. Zhan Demi, a mother in Tianjin, summed it up: \u201cMany people are even unemployed, or they are forced to stop working, or their salaries are cut. Rather than just being short of money, people tend to compare and make choices with more consideration,\u201d Zhan told the NYT.The numbers may still look strong. But for tens of millions of Chinese citizens, the story is no longer one of growth. It\u2019s one of survival.(With inputs from agencies)<\/p>\n","protected":false},"excerpt":{"rendered":"Across cities and countryside alike, middle-class families once lauded as China\u2019s growth engine now wrestle with mounting debt,…\n","protected":false},"author":2,"featured_media":9463,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[84,5928,5930,5927,5929,1294,56,54,55,5926],"class_list":["post-9462","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-chinese-are-drowning-in-debt","tag-chinese-communist-party","tag-chinese-economy","tag-chinese-loan-sharks","tag-economy","tag-uk","tag-united-kingdom","tag-unitedkingdom","tag-xi-jinping"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/9462","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=9462"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/9462\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/9463"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=9462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=9462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=9462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}