China’s record trade surplus + Anti-corruption campaign + De-risking

Welcome to this year's first edition of MERICS China Essentials! In this issue, we look at the following topics:

China’s export surge set a new record in 2024, flooding markets around the world with cheap goods, threatening jobs and growth. MERICS Lead Analyst Jacob Gunter says: “There is little surprise that more and more developed and developing countries alike are applying trade defense measures on China’s ever-increasing exports, and European leaders should be following suit.”?Read more

Xi Jinping and officials at the January meeting of China’s highest anti-corruption authority, the Central Commission for Discipline Inspection, vowed to fight corruption at all levels in 2025 – from senior government officials to local administrators.?Katja Drinhausen, Head of Program Politics and Society, MERICS says: The continued anti-corruption campaigns are upping the pressure on cadres and officials to be more accountable for their actions. But high expectations and limited resources may persuade many that inertia is safer than proactively implementing the party’s goals.” Read more

Beijing is reportedly delaying Apple contract manufacturer Foxconn from exporting specialized machines and rotating engineers to new factories in India. MERICS Senior Analyst Antonia Hmaidi :?"The pitfalls of moving a lot of manufacturing to China are becoming increasingly apparent to a growing number of foreign companies. But diversifying and de-risking will not necessarily be easy. ?Apple’s experience shows China’s government has many ways to make problems.”?Read more?

This week, China unveiled its newest 6th-generation jet fighter and the amphibious vessel Sichuan. Both are regarded as milestones in acquiring advanced weapons capable of penetrating the Pacific’s first island chain – Taiwan, Japan, and the Philippines – and countering the presence of the US in the region. MERICS Analyst Claus Soong says: "Beijing’s strategic focus and actions send a clear message – not only that China is powerful enough to compete militarily with the US, but also that Xi is actively pursuing his belief that ‘the East is rising while the West is in decline’.”?Read more

You can read this issue of MERICS China Essentials online here or download it as a PDF here.