Beijing is now extending its industrial domination to inputs and products located further upstream of value chains, such as chemicals, machine tools and industrial equipment, while consolidating its lead in key sectors of the energy transition: silicon wafers, used in semiconductors, critical minerals and magnets in particular1.
China could thus move from a sectoral industrial policy to a global approach which would make it possible to further increase its trade surplus.
- When compared to GDP, the first Chinese shock was much more massive than the second: between 2000 and 2008, the volume of Beijing’s exports of goods was multiplied by 4, and its current account surplus jumped by around 8 percentage points.
- The “second” Chinese shock, the beginning of which can be placed around 2018, only resulted in a 50% increase in exports and an increase in its surplus of 3.5 points respectively.
- This difference is explained in particular by the explosion of China’s GDP, which went from 1,360 billion dollars in 2000 to 18,740 billion in 2024 – an increase of almost 1,300%.
- The volume of exports increased from 266 billion dollars in 2001 to 37,720 billion last year. In 2025, China’s trade surplus exceeded $1,000 billion for the first time.
If market share gains by Chinese companies are currently concentrated in the electric vehicle and renewable energy sector, industries that the Chinese state began to subsidize in the 2000s, the “next shock” could concern segments that are traditionally dominated by Western countries.
- Chinese inputs and industrial equipment are increasingly integrated into products manufactured and exported by third countries, which is already creating indirect dependencies.
- The number of products for which China represents more than 50% of global exports has almost doubled between 2021 and 2024, going from 192 to 315.
- At the same time, the Chinese state plans to increase investments in several cutting-edge technologies – autonomous driving, integrated intelligence, biomanufacturing – as part of its latest five-year plan, adopted in March.
The Rhodium Group estimates that up to 12% of G7 countries’ manufacturing exports, or around $650 billion per year, could be captured by Chinese companies by 2030 if current trends continue.
- Beijing has taken a considerable lead in recent years in several key segments for Western economies, such as industrial robots.
- Since 2021, China has installed more robots in its factories than the rest of the world as a whole.
- In its 15th five-year plan, Beijing indicated that it wanted to move from classic industrial automation to cutting-edge robotics that integrates new advances made in the field of artificial intelligence.
