‘Zombie Company’ Apocalypse Looms in China | China Economy and Trade


Zombie companies in China. They’re bad for economic growth. and they’re eating up money like tasty brains. But there’s just no easy fix. for China’s coming zombie apocalypse. Welcome back to China Uncensored. I’m Chris Chappell. Zombies. They’re running amok in China. And no, I’m not talking about World War
Z, the book version, where the zombie apocalypse is triggered by organ trafficking in China. I’m talking about Chinese zombie companies. And they’re not as easy to kill as the Chinese Communist Party would like. That’s according to a study called “The mystery of zombie enterprises: stiff but deathless.” China’s zombie enterprises are state-owned companies that are consistently unprofitable— companies that, in a free market, would go bust. But in China’s state-managed economy, they’re artificially kept alive, thanks to what the study’s authors call repeated “blood transfusions.” Which makes them seem more like vampires than zombies. Zampires? Vombies? These “blood transfusions” are state-sponsored loans and subsidies. They’re what make these failing zombie companies “stiff but deathless.” These zombie companies are a problem for China’s economy as a whole— because they’re unproductive, they don’t innovate, and they don’t contribute to economic growth. Just like real zombies. “The persistence of zombie enterprises not only occupies precious resources,” the study says, “but also causes financing problems for other enterprises and lowers the production efficiency of the whole industry.” As this legion of the undead stumbles along thanks to Chinese government subsidies, it hurts productive companies… by eating their brains. Or at least by eating up resources that productive companies would otherwise
get. According to the European investment bank,
UBS, China’s economy is becoming less and less
efficient— partly as a result. Compared to a decade ago, it now takes twice as much capital to create the same amount of GDP growth. It’s hard to pin down the true number zombie firms in China, because, well, the Chinese Communist Party is not real good at transparency. In the same way that a brick wall is not real good at being a window. Official data from the State-owned Assets Supervision and Administration Commission,
or SASAC, says there are about 2,000 zombie companies run by the central authorities. But that’s just a fraction. Add in all the zombie companies overseen by local governments, and you get at least 10,000. But even that number is not easy to pinpoint. Because officials aren’t really motivated to do accurate reporting. “This is a case where these local governments, it seems, a number of them, have drawn up list of zombie companies in their jurisdictions, but are holding back on revealing those to
the banks… And it’s also the case, we’ve heard, that banking regulators in some of these provinces are also being kept in the dark.” And that was back in 2016. At the time, there was a broad push to fix broken parts of the Chinese economy. And Premier Li Keqiang launched an initiative for the “active and safe disposal of zombie
enterprises”. But fast forward three years, and that still hasn’t happened. Earlier this month, the head of China’s biggest aluminum producer warned that zombie enterprises are hampering China’s economic transformation. The zombie apocalypse is so nigh, that Xi Jinping himself recently vowed to slay the zombie hordes once and for all. He warned that China must be on guard against ‘grey rhinos’— which are highly obvious yet ignored threats. Which is weird, because in other countries, people think of rhinos as endangered species that should be protected. Anyway, back in December, 11 top Chinese regulatory and policymaking
bodies got together and pledged to get rid of zombie companies by 2020. Just like Premier Li Keqiang pledged to do back in 2016. But this time, it’s gonna be for real. And these regulators promised to publish a list of zombie companies within
three months. So that was December. Let’s see, January, February, March, hey that’s three months and…no list. Instead, we got only a statement on March
9 from Xiao Yaqing, head of the state assets regulator. And he was like, “Everything’s fine. State-owned enterprises are totally independent market players.” Although I’m not sure I trust a guy who— judging by this photo— is probably an actual zombie himself. I know what you’re thinking, “That’s just a joke, that photo probably just had bad lighting”. No, I’m serious. I’ve looked through a lot of photos of Xiao
Yaqing and I’m pretty sure he’s an actual zombie. Either that or he’s personally giving blood transfusions to the zombies. Zampires. Vombies. Xiao said that anybody who claims there’s a systematic arrangement for state-owned companies to get subsidies from the Chinese state is spreading fake news. Because these companies “are self-operated, self-financed, self-sustained, self-disciplined and self-developed.” Except…he’s lying. And he probably want to eat your brains. Remember that report, “the mystery of zombie enterprises – “stiff but deathless”’? Turns out it’s not that big of a mystery
why zombie companies—especially the biggest
ones— continue their long march of the undead. Brains. Sorry, I meant jobs. Zombie firms might pile mountains of bad debt on the banking system and hurt the economy in the long term by being unproductive— but in the short term, they provide jobs. And for the Chinese Communist Party, jobs and economic prosperity are the only reasons they’re still in power. Just ask driver Wong Wei. He blames his lost job in the coal industry when the Chinese regime moved to lay off 1.8 million workers in several zombie industries. “I borrowed more than I can afford just to buy this truck” says driver Wong Wei, “now no work, I’m angry with the government.” So Wong Wei thinks that the Chinese government is going the incorrect
direction. I guess he should know. Zombie companies operate on a simple formula. They “exist as a direct result of the resources and credit endorsements they receive from the government.” And “the companies that offer a greater
number of jobs receive more government subsidies.” And there are more poorly thought-out incentives. Local officials get job promotions if they meet employment targets in their regions. So as long as a company provides jobs, local officials try to protect it from getting
shut down. And as a result, local officials hide bad companies from central regulators who might want to
put them on lists of zombie companies to be eliminated. Sometimes, local officials even help them get more loans through hidden off-balance sheet transactions. “S&P credit analysts were using some colorful language to describe the risks around this, saying that the debt they’re talking about
is, the potential debt, is like an iceberg with titanic credit risks.” “Put that on top, by the way, of what we know the official numbers in terms of debt  in China, 260% at the very least to GDP, and it starts to add up to some pretty frightening numbers.” And for people who’ve been around the block
a few times, like this retired businessman, China’s plan to kill off or restructure its horde of zombie companies is doomed to
fail. “Even if they start to reform, it won’t
be deep because it’s related to the stability of the Communist regime and it’s related
to the nature of the government. The Communist government is established on
the state-owned economy. If they carry out deep SOE reform, they have
to change themselves.” And nobody wants to change themselves. So what do you think about China’s zombie
company apocalypse? Leave your comments below. And now it’s time for me to answer a question from a member of our 50-Cent Army who supports China Uncensored through the crowdfunding website Patreon. Sean Connelly asks: “Does the fifty cent army pledge level in any way refer to the Chinese company tencent? And if yes, what is the deeper meaning behind
it?” Good question, Sean. The term 50-Cent Army doesn’t have anything to do with Tencent. Or the rapper 50 Cent. The original term refers to how the Chinese Communist Party pays online commenters to manipulate public
opinion by posting things online that support the
Party line. In Chinese, they’re called the Wu Mao Dang, which means 50-Cent Party. They’re sometimes also called the 50-Cent
Army. Originally the name came about because they were supposedly paid the equivalent of half a Chinese dollar— 50 cents—per post. When I first launched our Patreon site back
in 2015, I decided it would be clever to create our own group of supporters, and call it the “China Uncensored 50-Cent
Army.” I asked fans to contribute 50 cents or more per episode to support the show. A year later, credit card companies made a new rule that the minimum pledge had to be $1 dollar… but I kept the name “50-Cent Army.” Thanks for your question, Sean. And thank you for joining the 50-Cent Army! Possibly by accident. And thanks to all my 50-Cent Army soldiers who support China Uncensored. It’s only because of your support that we’ve been able to keep this show going for so many years. Once again, I’m Chris Chappell. See you next time.

100 thoughts on “‘Zombie Company’ Apocalypse Looms in China | China Economy and Trade

  1. American should watch this channel for another 10years, the white elite brainwashing it's own people looks so funny.
    Good job, keep up with something like"China will collapse in 3days, 3, 3 month, 3 years.WTF.

  2. So why on earth would the PRC allow these failing state enterprises to continue? It's against their interests

  3. Every kind of company has to be a part of an industry and each industy has a consumption and production by tracking that you can track zombie companies

  4. Considering China's economic growth rate is in jeopardy and shrinking, along with India emerging as an economic power, and the US struggle for autarky, I'd say the future for China looks pretty bad. I'm genuinly glad. No nation today is trustworthy

  5. The facade can hold only so long before the truth starts to flood through the seams of the doors and break in through the windows. Then it will all come crashing down and the common folk suffer the most while the elite complete their parasitic lifespan.

  6. Is it true that in comparison to the US, China's economy is only 15 percent government controlled where as the US is close to 35 percent?

  7. That is exactly what we had back in the GDR. A "socialist" dictatorship. That kept unprofitable companies afloat for a artificially low unemplyoment.
    Estimates go as high as "70% of people should have been considered unemplyoed".
    But then there are a lot of times when I think: "If the GDR was still alive today, they would be doing the exactly same thing." everytime I hear soemthing about China.

  8. Knowing that Chris did those grunting sound effects, now you have an inkling of what he sounds like when amorous. Enjoy your nightmares.

  9. In my opinion, anything that weakens China's economy can only be a good thing. Perhaps the people of China will eventually revolt against and overthrow their horrible government. One can hope, at least.
    P.S. Anyone who disagrees must be a Chinese agent.

  10. Hey Chris Im 98.99% sure ive been subbed to your channel for awhile but just noticed today that I wasnt. Either Im mistaken or your video talking about Google might be causing some "accidentally" unsubs

  11. LMAO CHRIS… YOU MEAN LIKE THE CONSTANT BAILOUTS GIVEN TO HUGE PROFITABLE CORPORATE CRIMINALS IN NORTH AMERICA???? LOOK AT GM, FORD, ALL THE DRUG COMPANIES… YOU NEED TO START LOOKING AT OUR NATIONS HERE AND HOW SIMILAR OUR ECONOMICS ARE TO THEIRS… #LESSPROPAGANDA

  12. It's funny how the viewers of this channel tend to be ideologically split among the extremes of the political spectrum.
    On the one hand you have the hardline conservatives mostly motivated by the McCarthy-style "Better dead than red" mentality (which is wrong generally and morally imo, but right in this specific instance); and on the other the libertarian front mainly poised against authoritarianism on ideological grounds, which usually tend to the libertarian side of the far left, or even defy binary political categorization.
    I guess when an institution is so fundamentally evil, it's only natural that people across political lines will naturally feel motivated to oppose it once they are aware of it's transgression against basic morality and humanist values.

  13. wow I've been saying this for about 10 freaking years now, all I get is blank stares………like beeing looked at by a……ZOMBIE

  14. haha Wong Wei, thats almost as bad as the man that called his child SumTing, his surname was Wong also. the child had downs syndrome and he could see it straight away. SumTing Wong

  15. Zombie State Owned Enterprises Zombies have China in unmanageable Debt w/NoKo a drain Xi Jinping wants to end drain-Tech manufacturing leaving China in many cases Chinese Debt is really likely 320-360% of GDP realistically($9T in failing shadow bank loans in China of populace for real estate)-Belt & Suspenders China program only works because World Settlement Bank keeps ¥ propped up-US Debt to GDP at 105% give or take!

  16. Well done! You describe the US State-sponsored K-12 credential industry accurately and with remarkable precision.

  17. I feel bad for Hong Kong it's so better than Mainland China but China wants to remove that and make China part of the mainland

  18. Hay, we have the same thing in the US, only it's the MIC and the GOP that have driven up the US national debt to $22 TRILLION, which they use against the US from within!

  19. " Driver W(r)ong Wei" …you can't make this stuff up..! Although many Chinese drivers fit that descriptor…in China…and when they arrive in western cities… few are so aptly named

  20. Heyheyhey and does not give-away to blackmailing USA banks, not donate we must bankrupt inst except ZOMBIE banks feeding – sudo-communism -antyidea of communism – giving only to threatening banks? Happy Lehman to come again from your control, wait a second what fucking control government bankrupt so none to control. Am I confused by amount of debility side-squint (USA schizophrenia-stop side squint you are not two fucking continents doggy) association of dog putting nose into other dog shit for minerals justified? Thank you Chris-little China helper, try to ask neighbors what is honor of printing out money, yes call to China to get instructions. Maybe stop calling to lick them heals , strait to bed to licking feet because you not control your shit, must shitting down with begging for rolling your bonds into someone else bad, and blame him – shitting down with smuggled inflation. Salts licking for another lickthosefeetsfor rollingUSAobligations?
    You got problem since USA got no honor of printout, any else substitution, blaming attitude and being two faced doggy of private blasphemy anti-economy?
    You believe in private blasphemous mocking Capi_FUCKY-talisman will shine in your rectum forever!!! (it really will not)
    (unjustified, very unjustified) [you got no REASON in your economy -that means stealing by export of empty money, by flood and inflation, and still stealing that China bonds, must do roll, must do loose a little bit more]. Chris dog time to face it you masking lack of honor of printout by lack of dignity.
    And that grimaces if see your own made shit in front of your face that is Freud mechanism of projection guilty are there there there you you you just only not prosecutor? Will you fucking pay for Microsoft copy of Xerox OS that should not be copied, you haven't notice by falsification Windows fall apart more and more, not you wish to believe in the ,myth and get its returns of using working hypothesis? Dick with no balls all that your economical scum makeup leaking whore of administration above that fucking (not soap anyone eyes with war cost that is Morgan monopoly and looting aggregate, you ever had honor to face ). So have a nice everyday ball of dog shit propaganda consumed in your best audio in the word and so plenty medias, buy self all rubber S/M suit, nothing like USA products consume to the last crunch of wafer. Little beep of cost flooding that Africa till under biological survival. You would accept of course statement that you are casual USA bitch with no honor whatsoever, well except that you eating shit – stupid dog? See I am leaving you a pattern vindicate Morgan. Or your economical shit-beeps will be only your coneseur. I do not ever fucking blame China for you bankruptcy caused by 1933 sponsoring of Hitler – Coca-Cola IBM Morgan Rockefellar + others, ever recognized broken protocol, bitch in shit pie of looting, boil yourself in shame of truth, boil yourselfe in your shit soup. Well if shit = Dollar wouldn't lose it value 50% every 20 years, maybe you would not have student debt Chris because it work better not for sudo-communism '''give-away-to-rich' … if … shit… dollar…. wouldn't be…… fucking 40% weighted at printout by means of blasphemous work, now mr Chapel who is the whore (USA citizen) to cover that, many energies invested to slam other side of the worlds, see , YOU ARE BLIND (maybe bling bling rich -BLIND)
    Report on blind to kennel (studio) bark in dab position onto yourself. Maybe will help Chris, only maybe I do not know how to cure man of being BITCH it is you always giving own and someones back in trouble, one time haven't support military poor country and those rich loosing approx. 1/2 / 2000tonnes of gold, silly they selling it 50tonnes at NY market. Now now bite your tail and run again how you had adsorb it, ignorance is bliss. Assure you that not. You are counting everyday more Coca-Corpaine issue blessed. But you got no pride honor or citizen bereavement, your citizenship is famously reporting UFO at neighbor and laugh and children accidental gun suicide, explain adults carefulness, leader. You forgot rotting shit of bankruptcy in the drawer next to your bed should be removed from children reach too. Bitch. But there fucking problem and care for my own ever will pass that net of comfy sarcastic lies about someones economical condition face? Fucking empty dollar internal DARPA steroid(inject it Trillion) keeps you pendulum legsi and wait to rolling you over sponsor? Try to live on the own not reminding self prosperity of slavery – till now you got those tastes. So who got doggie rope, mr Morgan bu but Chris is silent bitch licking his crotch till see thorough.
    Really dog behave from behaviorism.

    You USA sponsored Hitler what you haven't processed by law after war, you got patents of war with avoidance of its creator, you always support only fascist war – only for money Rohinga , Kurdi? you do not give a fuck for any shitting peace USA want money at war – banditism. Afte war you accepted loads of looting shit and Soros -NY "victim heritage" Jews -Morgan hand of papers with jumping gobs gimme money. And what you are fucking doing Chris sending wisdom from NAZI scientist upgraded country, much fucking enlighten? What you are bastard of Dr. Green, Mengele experiment of brainless shiny teeths propaganda male-cunt? Help Vietnam 4th generation of victims of Agent Orange, bitch! Stop fucking barking, someone will just kick your snout (look America is two continents Idiot, maybe NCA-man, Morgan economical shit little PAC-MAN. You can call yourself Morgan little economical shit/turdeater but stop schizofrenical side squint-two continents man, maybe your mother got two storey-ass. instead, another hiding fact. Get fat riding 7 liter car, get back on mall trolley that how you look at your mouth expedition to China, Wal_Mart fattie got right to e-trolley get fat because too big car, understand, suffer bitch. Just fuck of with your blasphemus just in decades worh only toilet roll, non stop loosing – robbing people, week to have not balls Chris. Bitch.

  21. ''Kurt Kışı Geçirir Ama Yediği Ayazı Unutmaz'' Turks Can't Be Easily Destroyed How happy is the one who says I am a Turk

  22. It seems that every country is maxed out in debt. My question is – who are they in debt to? Sounds like a house of cards.

  23. Oh man the world is heading into funky territory.
    The western banking system is snowballing a giant crisis that will make 08 look like a childrens birthday party, and china is basically one big government built bubble fake economy.
    Funky funky times. Stay safe everyone.

  24. I have a question Chris, how do you say get woke go broke in Chinese? Maybe You can tweet it to comrade xi ? IDK it might help with the zombies.
    Its either that ,or send him a really big flame thrower.
    What can i say, i have a soft spot for whinny the pooh! I'd hate to seen him get eaten by zombies.

  25. Sounds exactly like what going on here in the USA, except the Zombie Company workers are government employees.

  26. Zombie is ubiquitous. Every corners of the world, that says without words. If you want a good zombie as pet, you can get the best species in USA. US is ideal home for many a zombies..

  27. american gov did the same thing even balled out companies that moved to china…its fucked up ..also america has the same problem,you can look at compaines that run off tax money and never turn a profit..same shit,the worlds system is totally fucked

  28. You bustard westerner want to kill us muslims hear it islam is the religion of father of mankind hear it its the din e ibrahim none of you even chinese as well as hindu can destroy islam verily they will try to extinguish the light which we gave to you but they cannot even if they can and it will illuminate even if they hate it

  29. @ 0.50 you say "…companies that are consistently unprofitable. Companies that in a free market would go bust."
    Kinda like, Facebook, Tesla, and others.

  30. "Just like real zombies"…? Chris says in this video but only if you consider any one who needs help the evil dead…! is that the final word from China uncensored or are you worse than anything Communist have ever demanded we all be school'd on. The test being your very life but first all those who dare show you love are now well on the road to becoming one of your elitist's evil dead.

    "Stop weaponizing our children"! YVO All the cash in the world is not worth one persons life and never will be. Bottom line zombies have been designed to train our youth to grow up ready to better accept the seperation of classes or cast syndicates for genocide…! https://youtu.be/opQ1_O-TXmY

  31. China Uncensored has vast become the demon they fain to defeat…! "Have it become standard practice of all anti communist to ruthlessly forget that state run under any name or ideal is still responsible for over-site's in mandates and the time effort and cash to correct these mistakes! which have in balances many good peoples lives…! Have it become standard practice to covet those who have riches so much that we train our people from very young to cast themselves entitled to call the rest of us manually made redundant by syndicated flash mobs of people calling their poor and needy zombies…? "Stop weaponizing our children"! YVO https://youtu.be/opQ1_O-TXmY

  32. Are our comments being edited so only comments politically correct get to stay up long enough for any YouTuber's to read them… uncensored…? In from North America the land sold over and over again as their governments carry out the dictates of the cash proud malevolent. As fake immigration…!
    YVO https://youtu.be/opQ1_O-TXmY

  33. As soon as they said that that guys name was Wong Wei I died laughing and couldn't focus on anything the narrator was saying.

  34. Do Chinese CCP members hair grow grey??… It's always well kept and black even that of Winnie the Pooh
    Oops Xi pin pooh

  35. State owned companies are as self financed as the USPS is. Thing is once they run out of money then the government rushes in to bail them out of bankruptcy to keep them going. Just stop doing that and the problem solves itself.

  36. The easy fix to chinese zombie companies(and the democrat answer to everything) is to have ALL the chinese citizens move to the U.S..

  37. China is counting on exploiting other countries that are part of one belt one road initiative. Like it did with Venezuela and it's oil! The interest in the money loaned has to be paid back in oil… just the interest ,not the principal. What is the interest on billions…enough to pretty much own that oil!!

  38. This is one channel that accomplishes two goals with seeming effortlessness behind which lies mountains of hard work: highly informative, and very funny.

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