Over the past few years, the United States has imposed a series of tariffs and export controls, prompting multinational companies to adopt “China plus one” strategies while supply chain resilience has become a boardroom obsession. Yet despite these shifts, China’s exports have continued to grow, playing a critical role in cushioning its weakening domestic economy. Data shows that the country’s goods trade surplus reached a record $1.2 trillion in 2025. However, analysts and observers note that it would be a mistake to assume this trajectory can carry on indefinitely, as what remains economically efficient is increasingly no longer politically tenable.
China’s manufacturing dominance is generating widespread resistance that extends far beyond the United States. In Europe, policymakers and industry leaders have expressed growing concern regarding the potential erosion of the continent’s industrial base. Meanwhile, developing countries that welcome Chinese investment and admire aspects of China’s development experience are beginning to raise a fundamental question about the imbalance of the current trade relationship. Nations want to know where their own development fits into this established model.
Most countries are no longer satisfied with simply purchasing finished Chinese electric vehicles, batteries, solar panels, machinery, and robots. Instead, these developing economies want factories of their own on home soil. They want their domestic workers to acquire new industrial skills and their local suppliers to move up the global value chain. Crucially, these nations are demanding technology and know-how.
For years, Western companies complained that gaining access to China’s enormous consumer market came bundled with strict demands for technology transfers. Now, Beijing finds itself on the other side of the negotiating table, facing similar demands from emerging economies that expect expertise sharing in exchange for market access.
