China’s Keynesian Model Is Crumbling—It Needs a Trade Deal, Fast

A container ship heads out from a port in Qingdao, east Shandong Province, China, on May 7, 2025. Chinatopix Via AP

Commentary

In the past decade, the Chinese economy has expanded its central-planned neo-Keynesian model, which simply cannot survive without a trade deal. The Chinese manufacturing sector has followed a running-to-stand-still strategy that simply cannot subsist without the enormous trade surplus with the United States.