Biden Says China’s Economy Is ‘Ticking Time Bomb’

U.S. President Joe Biden delivers a speech to mark the one-year anniversary of his signing into law the Promise to Address Comprehensive Toxics (PACT) Act at the George E. Wahlen Department of Veterans Affairs Medical Center in Salt Lake City, Utah, on Aug. 10, 2023. Madalina Vasiliu/The Epoch Times

U.S. President Joe Biden on Thursday called China’s economy a “ticking time bomb,” a remark that drew protests from Chinese authorities as his administration renews engagement with Beijing.

At a political fundraiser in Utah, President Biden called the Chinese Communist Party (CCP) leadership “bad folks,” saying the country is in “trouble” because its economic growth has weakened and the unemployment rate hit a record high.

“They have got some problems. That’s not good because when bad folks have problems, they do bad things,” said President Biden, according to a pool reporter.

“China is a ticking time bomb,” he said.

“China was growing at 8 percent a year to maintain growth. Now close to 2 percent a year,” he claimed.

However, the president misstated the country’s growth rate.

China’s economy grew 4.5 percent in the first quarter and 6.3 percent in the second quarter, with gross domestic product (GDP) growth at 0.8 percent in April-June from the previous quarter, according to data released by the National Bureau of Statistics (NBS).

President Biden told donors that he did not want to hurt China and wanted a rational relationship with the country.

The comment drew the ire of Beijing. State-run media Xinhua responded on Friday by accusing U.S. politicians and Western media of using China’s economic problem as another topic to “bad mouth” the second-largest economy in the world.

Renewed Engagement With China

President Biden’s remarks echoed the comments he made at another fundraiser in June when he referred to Chinese leader Xi Jinping as a “dictator.” The statement came a day after Secretary of State Antony Blinken had a “robust conversation” with Mr. Xi and other top diplomats in Beijing.

Foreign ministry spokesperson Mao Ning said President Biden’s remarks “seriously violated China’s political dignity.”

“They’re an open political provocation,” Ms. Mao told a press conference in June.

The Biden administration is seeking to reduce tensions between Beijing and Washington as bilateral ties worsened over issues, from Beijing’s unfair trade practices to its aggression against Taiwan.

U.S. Secretary of State Antony Blinken (L) attends a meeting with Chinese leader Xi Jinping at the Great Hall of the People in Beijing on June 19, 2023. Leah Millis/Pool/AFP via Getty Images

President Biden has previously said his reference to Mr. Xi as a “dictator” won’t derail the relationships with Beijing.

“I expect to be meeting with President Xi sometime in the future, in the near term, and I don’t think it’s had any real consequence,” said President Biden.

Indeed, in the following three weeks, the Chinese leadership welcomed two other senior administration officials separately.

A fourth senior U.S. official could be visiting China soon. According to a July 13 report from Xinhua, China’s commerce ministry was “in communication” with the U.S. side about a possible China visit by Commerce Secretary Gina Raimondo.

Media reports indicated Ms. Raimondo will travel to Beijing later this month.

On Thursday, President Biden signed an executive order to begin the process of restricting high-tech U.S.-based investments going toward China in the areas of artificial intelligence, quantum technology, and semiconductors. The executive order has Chinese officials gravely concerned. China’s commerce ministry said on Friday that Beijing reversed the right to take counter-measures.

China ‘Needs the West’

Outside observers have repeatedly warned that such high-level talks with American officials served the interests of Beijing, whose leadership is struggling to roll out more policies to restore domestic demand and revive the weak economy.

“China has been playing hard to get for the last several months, and they would not talk. Now they relented and agreed to talk with high-level American cabinet members on matters that are vital to both nations’ economies,” said Miles Yu, a senior fellow and director of the China Center at Hudson Institute.

“The reason why they relented is because China’s economy is in big trouble,” Mr. Yu said during a July interview on EpochTV’s “American Thought Leaders: NOW.”

“They need the West much more than the West needs China. So they’re being a little bit more realistic this time.”

The interview came as U.S. Treasury Secretary Janet Yellen traveled to Beijing to meet with Chinese Premier Li Qiang, who has recently been tasked to revive China’s COVID lockdown-battered economy by Mr. Xi.

A construction worker rests near a building in the new Yujiapu financial district in Tianjin, northern China, on May 14, 2015. Greg Baker/AFP/Getty Images

The latest microeconomic data showed the consumer sector fell into deflation. The consumer price index (CPI) dropped 0.3 percent year-on-year in July, according to the NBS, the first decline since February 2021. The producer price index (PPI) declined for a 10th consecutive month, down 4.4 percent and faster than the forecast 4.1 percent fall.

Experts noted that China is entering an era of much slower economic growth akin to Japan’s “lost decades,” which saw consumer prices and wages stagnate for a generation, a stark contrast to the rapid inflation seen elsewhere.

Reuters, Andrew Thornebrooke, and Frank Fang contributed to this report.