Funds are fleeing China at an accelerating rate

A foreign media reported on October 17th, that are fleeing China at an accelerating rate. Not only foreign investors’ have fled, but even some local Chinese are doing their best to transfer money abroad, and most of them use underground channels to transfer assets.

According to official data from the CCP, in the first half of 2022, more than $100 billion in net outflows from China, including the stock market, bond market, and direct investment, which is the largest capital outflow since 2016. Foreign investors were net sellers of Chinese bonds for seven straight months through August, according to monthly bond market data. At the same time, the China Yuan has depreciated against the dollar this year.

Most astounding, China’s financial statements classify large dollar outflows as “errors and omissions.”. Some economists believe that this phenomenon reflects the flight of funds through illegal or underground channels, not only the withdrawal of foreign investment banks, but also the intensification of some unrecorded fund transfers. Domestic wealthy people are transferring assets abroad to seek safe havens.

The prospects for the future are even worse, with Xi Jinping mentioning words such as “turbulent waves” and “self-revolution” at the 20th National Congress of the Communist Party of China. In this regard, Mr. Guo Wengui said that after the 20th National Congress of the Communist Party of China, the CCP will clean up the party internally, plunder private property, and fight the West to the end. Therefore, risks such as a new round of Cultural Revolution, exclusion of dissidents, Western sanctions, and even war are densely populated, and funds will be more likely to evade risks.