Already a subscriber?Will China’s efforts to compensate for the collapse of its property market bubble by boosting its production of high-end industrial manufactured goods eventually backfire?
Given the weak demand in the Chinese domestic market, this has resulted in massive excess capacity. But Beijing’s strategy appears to be to rely on export markets to clear surplus production of items such as solar panels, semiconductors, electric vehicles and advanced machinery. According to the latest Chinese economic figures, manufacturing sector capacity utilisation rates tumbled to 73.8 per cent in the first three months of the year, the lowest rate since at least 2015, excluding the quarter of 2020 when Chinese economic activity was hard-hit by the pandemic.