6 Factors That Describe China’s Current State

A woman walks past stores in a shopping mall in Beijing on July 18, 2023. Greg Baker/AFP via Getty Images

Commentary

As we cross the midpoint of 2025, it is evident that this year has been characterized by turbulence, uncertainty, and deepening despair for many in communist China.

Six phenomena best capture the country’s current state: decline, fierce competition, political struggles, the “run” movement, random acts of violence, and the “lying flat” movement.

They reveal the erosion of trust and a growing sense of disillusionment and unrest among the populace.

Decline

For many in China, 2025 is the most challenging year in nearly three decades, with numerous sectors of society experiencing a significant downturn. The real estate market is the most notable example.

By the end of May, average “floor” prices for transactions in land for residential use had fallen by nearly 50 percent in second-tier cities and by almost 40 percent in third-tier cities. These prices are calculated by dividing the total land cost by the total floor area that can legally be built, providing a measure of the land acquisition cost for developers.

Local governments, heavily dependent on land sales for revenue, have seen this vital revenue stream nearly vanish—crippling their finances.

The economic downturn is also evident in the decline of consumer spending. Signs of shrinking domestic demand include price wars in the electric vehicle sector, the widespread closure of small businesses, and decreasing sales of luxury goods such as cosmetics, high-end watches, and designer handbags. Many foreign companies are either downsizing their operations or leaving the country altogether.

Salary cuts have affected employees across various sectors, including banking and finance, civil service, and both state-owned and private enterprise. Moreover, the unemployment rate among recent college graduates is rising, leading many individuals to anticipate joblessness after graduation.

Yet the most significant decline is not related to the economy but to the public’s confidence in the regime. Among ordinary citizens and government officials, many have lost hope in the Chinese Communist Party (CCP). No amount of optimistic rhetoric or economic stimulus can reverse this situation. The erosion of trust has triggered capital flight and stock market exits, posing perhaps the greatest legitimacy crisis the CCP has ever faced.

Fierce Competition

Excessive competition within the same industry has been a longstanding issue under communist rule, leading to infighting and internal exhaustion.

This year has seen a notable increase in business closures, including restaurants, hair salons, bubble tea shops, beauty parlors, car dealerships, and more. While the economic downturn is a significant factor, internal competition has also played a vital role. There are too many businesses vying for limited demand, which has prompted them to undercut each other in increasingly unsustainable ways. As a result, many are struggling, ultimately leading to shutdowns, and the deteriorating economy has only worsened this situation.

Political Struggles and Infighting

Infighting among top CCP officials is one of the most sensitive and consequential developments this year and is particularly evident in the ongoing military purge.

What began in late 2023 as a sweeping crackdown on the Rocket Force—initially targeting high-ranking officials seen as disloyal to Chinese leader Xi Jinping—took a dramatic turn in the second half of 2024. In a striking reversal, more recent purges have targeted Xi’s allies, suggesting a weakening of his grip on power.

According to credible insiders speaking to overseas Chinese dissidents, Xi’s role has now become largely ceremonial. There are growing indications that top CCP officials have reached a consensus: Xi will soon be officially removed from power.

This unexpected power shift has become the defining feature of China’s political landscape in 2025.

‘Run’ Movement

This situation describes the increasing trend of Chinese citizens attempting to leave the country by any means available.

Following the CCP’s draconian three-year COVID-19 lockdowns, a growing number of people sought to emigrate to the United States, with some even illegally crossing its southern border on foot. But with President Donald Trump’s return to the White House, that pathway is now largely closed.

In recent years, some Chinese also attempted to settle in Canada by overstaying tourist visas and applying for political asylum. However, Canada has also tightened its visa policies.

Now, Thailand and Malaysia have emerged as new destinations for middle-income Chinese hoping to join the “run” movement.

For wealthier individuals, Japan has become an increasingly attractive destination compared to many Western countries, thanks to its relatively accessible business manager visa.

This visa has no requirements for Japanese language proficiency, academic qualifications, or age limit. Instead, applicants must invest a minimum of 5 million yen (approximately $35,000) in a Japanese company, register the business, and secure a physical office space.

Additionally, the business must employ at least one full-time staff member who is either a Japanese national, a permanent resident, the spouse or child of a Japanese national or permanent resident, or a foreign national with long-term resident status. Applicants can bring their family members if their business plan is approved.

Regardless of their socioeconomic status, many Chinese are leaving the country. This trend underscores the grim reality of oppressive governance, where mounting pressures compel people to take drastic measures.

Random Acts of Violence

Another disturbing phenomenon is the rise in random assaults over the past two years.

Many Chinese, either trapped by overwhelming hardship or victimized by injustice, have no outlet for their grievances. Tragically, violence often ensues when they lash out in an attempt to express their pain. The following events could be linked to this.

On Jan. 27, in Bozhou, Anhui Province, a sedan plowed into a crowd, injuring multiple people.

Then, on March 23, a man carried out a knife attack outside a supermarket in Shaoxing, Zhejiang Province, randomly targeting passersby. Several people were reportedly injured. A netizen posted videos of the incident on social media that may be disturbing to some viewers.

Just days later, on March 26, in Anyang, Henan Province, a taxi drove erratically down the road, hitting pedestrians and vehicles. Some sources claimed that pedestrians and food couriers were killed. A netizen posted a video on social media that may be disturbing to some viewers.

Authorities quickly censored information regarding these incidents.

‘Lying Flat’

This movement, initiated by young people in China in recent years, is a response to societal burnout, where individuals withdraw from the competitive frenzy and adopt a slower, minimalist lifestyle.

A new term has emerged to describe individuals who take the concept of “lying flat” to the extreme: the “Five Nos” youth. These individuals consciously choose not to buy a house or car or make unnecessary purchases, and forgo marriage and children. Their focus is on minimizing expenses as much as possible.

As the economy continues to deteriorate, this passive withdrawal from societal expectations has become increasingly widespread. In essence, Chinese society seems to have lost its vitality.

No Hope for Recovery Under CCP Rule

These miseries are the outcome of decades of communist rule coupled with a continuously weakening economy.

The CCP had hoped to stimulate the economy by relying on an internal circulation model, encouraging people to spend their savings. However, this strategy has failed because China lacks a reliable social security or welfare system. With people earning less, they are too afraid to spend. Consequently, consumption has stalled, and the economy has slipped into deeper stagnation.

As a result, all the gains from years of reform and opening up have been exhausted.

Furthermore, the CCP’s governance model is detrimental to society, especially in times of crisis. Misguided attempts to cling to power—such as by implementing the draconian zero-COVID policy during the pandemic, adopting wolf-warrior diplomacy, and allowing the unchecked growth of the real estate bubble—have seriously harmed Chinese society.

Worse still, the CCP has eroded China’s moral compass. Dishonesty, betrayal, and opportunism have become increasingly commonplace, resulting in a pervasive atmosphere of mutual distrust in everyday life. In 2025, the consequences of this decades-long degradation have reached a breaking point.

If the CCP continues its rule, ordinary citizens will face increasingly difficult years ahead.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.