"China has risen to become a global market leader in key industries. With precise industrial efforts, China leads in patent applications."

"The Middle East has oil, and we have rare earths," it is said that the Chinese leadership realized as early as 1987 the areas where China needed strategic investment. Since the 1980s, China has focused on the processing and export of rare earths. Without rare earths, smartphones, rockets, electric vehicles, and wind turbines would not function. The German magazine Zeit reported that today, China controls 60% of global rare earth mining and 90% of rare earth processing. In the trade dispute with the United States, rare earths have become a decisive lever for China to counter Trump's high import tariffs.

China's wind energy products go global

Rare earths are just one typical example of China's carefully selected target markets and its striving to become a global leader. In 2015, China launched the "Made in China 2025" initiative, aiming to transform China into a high-tech manufacturing country. This also marked China no longer serving as an extension of multinational companies providing cheap labor. Since then, trillions of dollars have been invested in fields such as information technology, electric vehicles, and medical technology.

For a long time, China has been leading in many areas of the global market. In raw material-dominated fields, China has left the West far behind in five areas.

Report by the German magazine Zeit

Antibiotics

China holds a dominant position in the global important antibiotic market. Since the beginning of the 21st century, China's pharmaceutical industry has focused on mass production of simple active ingredients and starting materials for generic drugs. Now, most antibiotics are generic drugs, i.e., drugs not protected by patents. Many generic drugs are produced in India, but Indian companies rely on raw materials from China.

In Western industrialized countries, most generic drug manufacturers have now closed their domestic production facilities—these factories could not make a profit. As a result, Chinese manufacturers currently control 80% of the raw materials for key active ingredients such as amoxicillin, which are used worldwide to treat pneumonia and throat infections.

The rising status of Chinese manufacturing

Lithium batteries

China is now the world's largest producer of electric vehicles, mainly because it produces the required lithium-ion batteries at the lowest cost and with leading technology. China not only controls most battery production but also chemical production and raw material processing. Currently, more than 70% of global battery production comes from Chinese factories. Over 90% of graphite is refined in China.

Chinese electric vehicles are increasingly exported around the world. Large car manufacturers like BYD and battery manufacturers like CATL have taken a dominant position in the global market. At the same time, companies like the Swedish battery manufacturer Northvolt have gone bankrupt.

New lithium iron phosphate (LFP) batteries are also experiencing extremely rapid growth. Their chemical composition differs from lithium-ion batteries and are expected to be safer and more durable. By 2024, nearly half of all electric vehicle batteries installed will be LFP, of which 80% will be manufactured in China.

CATL at a German exhibition

Steel

For decades, Chinese enterprises have dominated global steel production. In 1996, China replaced Japan as the world's largest steel producer. Today, Chinese enterprises produce more than half of the world's crude steel, reaching about 1 billion tons in 2023. Following closely is India, with a production of about 140 million tons, followed by Japan, the United States, and Russia. According to the World Steel Association, in just the past year alone, 27 out of the world's top 50 steel producers were from China.

Without a domestic steel industry, China would not have risen from an agricultural country to an economic superpower. The economic boom of the 1980s was mainly due to the rapid expansion of infrastructure supported by the state, such as bridges and railways, as well as large-scale construction of residential and commercial buildings to promote urbanization. Both industries required a lot of steel. China's steel exports have also increased significantly. In 2023, China's steel exports exceeded 90 million tons, an increase of over 30% compared to the previous year.

The trajectory of China's leading position in shipbuilding

Shipbuilding

Although the shipbuilding industry has long been the leading industry in East Asia, it has not been firmly controlled by China for a long time. Previously, the largest and leading shipyards were from Japan, and later from South Korea. In 2002, Beijing clearly expressed its ambition to make "China the world's largest shipbuilder."

China has now achieved its goal. A study published by the Office of the U.S. Trade Representative found that China's share of the $150 billion global shipbuilding industry has risen from around 5% in 2000 to over 50% in 2023. Whether it is container ships, oil tankers, or bulk carriers, China builds almost all types of vessels at the forefront—only cruise ships are still held by European shipyards.

In the shipping industry, China also plays an indispensable role. COSCO has become the shipping company with the largest number of vessels (over 1,500). COSCO also owns shares in container terminals around the world, such as the container terminals in the Port of Hamburg and the Piraeus Port in Greece. Therefore, China has gained access to the entire logistics chain.

COSCO cargo ships entering German ports

Wind turbines

The Chinese wind power industry continues to set new records every year. Last year alone, China added approximately 8 gigawatts of wind power capacity, accounting for about two-thirds of the global annual addition. Chinese wind power companies are ambitious and are seeking international expansion. Companies like Goldwind have now become among the largest manufacturers in the world, with factories established in Brazil. Envision Energy achieved the largest overseas business in China's wind power industry last year, with projects in eight international markets. Chinese enterprises are building in Kazakhstan, producing in India, and collaborating with South Korea and Italy. Given climate change, China is committed to becoming a key participant in the expansion of renewable energy.

According to a warning from the German Wind Energy Association (BWE), the solar industry 15 years ago may follow the same path. Today, China has become an undisputed leader in the European and global photovoltaic market. The pace of China's entry into the European wind energy market is evident: the first Chinese wind turbines have already been put into operation in countries such as Serbia, France, Italy, Sweden, and Croatia.

Currently, Europe has ordered a total of 2.7 gigawatts of Chinese wind turbines, most of which were ordered in the past two years. BWE said that Chinese manufacturers are putting great pressure on European companies: not only are their prices as low as 50%, but their delivery speed is also fast, offering favorable payment terms.

Original text: https://www.toutiao.com/article/7529882624085459496/

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