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If historians look back at 2025 in the future, they may regard this year as a pivotal point in the most dramatic reversal of the global economic narrative.

At the beginning of the year, "China collapse theory" remained the mainstream discourse in Western media; by year-end, however, international public opinion had to acknowledge that China has joined the ranks of the world's two major economic superpowers.

American publication Bloomberg even directly stated in its year-end column: "Never, Ever Underestimate China." (Repeat After Me: Never, Ever Underestimate China)

I. The "3D Dilemma" at the Beginning of the Year: Deflation, Debt, and Demographic Crisis

In early 2025, Western economists' assessments of China's economy were almost unanimously pessimistic. They summarized China's challenges with the term "3D issues":

Deflation: Consumer Price Index remained low, and corporate profits were under pressure;

Debt: The risks of local government and real estate debt were repeatedly highlighted;

Demographics: Aging accelerated, and the labor force shrank.

Combined with Trump's second-term trade protection policies, some foreign media even claimed that China would repeat Japan's "lost thirty years". Wall Street analysts were busy calculating the timeline for "supply chain withdrawal from China", as if an economic recession was already a certainty.

II. The Key to the Reversal: Industrial Resilience vs. Financial Cycle Logic

However, reality quickly broke the limitations of the prediction models.

The root cause of the Western elites' miscalculation lies in their use of short-term fluctuations in financial markets to measure China's economy, while ignoring its long-term resilience based on a full industrial chain. This resilience is reflected in three dimensions:

The engineer dividend replacing the demographic dividend

Previously, China's competitiveness relied on cheap labor; now, its core advantage is the world's largest pool of high-quality talent. Data shows:

The university enrollment rate in China rose from 10% in 2000 to 40%;

The number of engineers increased from 5.2 million in 2000 to 17.7 million (in 2020);

47% of top AI researchers globally hold a bachelor's degree from China (only 18% in the U.S.).

This "law of large numbers" means that even with the same probability of technological breakthroughs, China's large base is destined to produce more innovation.

For example, Apple tried to move its supply chain to India but found it difficult to replicate China's efficient technical worker ecosystem there.

The Dual Nature of Deflation: Intense Competition Forging International Competitiveness

Although deflation suppressed some company profits, the brutal domestic market competition actually forged a batch of globally competitive brands. For instance:

Bobao Mate achieved a 70% gross profit margin through IPs like Labubu, far exceeding traditional toy manufacturers;

Domestic air conditioners, luggage, and fragrance categories have shifted from "low-cost manufacturing" to "design output," even being praised by Italian consumers as "comparable to local quality."

Strategic Resource Bargaining Chip

Facing U.S. trade pressure, China countered by using key resources like rare earth elements, demonstrating its leverage on the negotiation table.

This strategy of "exchanging hard technology for voice" forced the West to reassess its reliance on China.

III. The Root Cause of Western Misunderstanding: Prejudice and Information Bubbles

Bloomberg columnist Shuli Ren pointed out that the misjudgment of Western observers stems from two blind spots:

Value Filter: Some scholars, due to ideological differences, refused to deeply understand the actual operational logic of the Chinese market;

Data Dependency: Over-reliance on macroeconomic indicators, but neglecting the micro-level vitality of enterprises — such as the research centers that remain brightly lit late into the night in the Yangtze River Delta, or the technical capabilities of private enterprises evolving through fierce competition.

IV. Insights: The Fundamental Logic of a Superpower

The turning point of 2025 proves that the status of an economic superpower is not determined by short-term fluctuations, but rather by:

Education investment: The engineer dividend is the cornerstone of technological innovation;

Industrial chain depth: A comprehensive industrial system offsets external shocks;

Market resilience: Intense domestic competition pushes companies toward high-end development.

As the conclusion of the article states: "If there is still one economic superpower that cannot be ignored in today's world, it must be China."

This comeback not only redefined the global power structure but also provided developing countries with a development path different from the Western model.

(Note: This article is compiled from Bloomberg, educational statistics, and industry data. The views are for reference only.)

Original: toutiao.com/article/7588030818904310306/

Statement: This article represents the personal views of the author.