Local Overcapacity in China: An Integral Part of Economy for Years

Tuesday, 21 May 2024, 04:00

The deep-rooted overcapacity issue at local levels in China has been a significant driver of the economy for decades. The article discusses how the ebbs and flows of overcapacity have shaped the economic landscape, with the current influx of new-energy manufacturing adding to the existing challenges. This trend has led to institutional upheavals and reduced the competitive space for foreign firms.
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Local Overcapacity in China: An Integral Part of Economy for Years

Impact of Local Overcapacity in China

The overcapacity issue stemming from local levels in China has had a profound impact on the economy, with far-reaching implications.

Historical Context

  • Underpinned Economy: The ebbs and flows of overcapacity have been integral to the Chinese economy for decades.
  • Foreign Competition: Foreign firms have faced challenges in competing due to the surplus of Chinese goods.

In the current scenario, the influx of new-energy manufacturing has further exacerbated the overcapacity challenges, leading to institutional changes and market disruptions.


This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.


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