Overcoming the geopolitics of overcapacity through cooperation

By Weihuan Zhou, Victor Crochet and Henry Gao

Overcapacity in Chinese industries like steel, EVs and solar panels has become a flashpoint in global trade, especially in US–China tensions. While often framed as unfair trade practices due to subsidies and low-priced exports, these concerns reflect deeper strategic fears about China’s rise in key sectors. Despite high tariffs and anti-circumvention measures, China remains a dominant exporter and is shifting excess production towards domestic consumption. Lasting solutions require multilateral cooperation and WTO reform to restore trade stability.

To see the full article, published 9 June 2025, visit East Asia Forum.