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China's economic recovery
EconomyChina Economy

Coronavirus: China’s economic slowdown looks like a ‘lifetime of debt’ for some citizens

  • Rising debt and falling incomes are becoming a reality for many Chinese, from business owners to office workers
  • Faced with an uncertain outlook, households are cutting back on spending, which is likely to worsen the economy’s slowdown

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Slowing economic growth, driven by Beijing’s zero-Covid strategy, is putting enormous strain on the finances of many middle-class Chinese. Photo: AP
He Huifeng

After Fiona Hu left her small rural hometown at 18 years old, she put in decades of hard work to start her own beauty salon in Guangzhou.

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But after two years of on-again, off-again business due to the coronavirus pandemic, she is drowning in debt and her dream is turning into a nightmare.

“Now, I have nothing but loans,” the 44 year old said.

Slowing economic growth, driven by China’s zero-Covid strategy – which relies on lockdowns and mass testing to stamp out local Omicron outbreaks – has put unbearable strain on her business and personal finances.

Hu and her husband had been struggling to cover their bills for about a year, but by May, they could no longer make monthly mortgage payments of 9,000 yuan (US$1,341). Their flat is set to be seized and auctioned.

I don’t think I can get out of debt in my lifetime
Fiona Hu

“I don’t think I can get out of debt in my lifetime. Everybody is struggling – life is very difficult,” said Hu, who owes more than 2 million yuan on top of the mortgage.

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