China's Resilience in Global Trade Amid the Ongoing Trade War

China's grip on global trade has proven remarkably resilient amid the ongoing trade war, even as adversaries from the U.S. to the EU have imposed tariffs and anti-subsidy measures to curb its influence. The country's strategic commodity exports-electric vehicles (EVs), batteries, solar panels, and semiconductors-have not only withstood these pressures but have also expanded their global footprint, reshaping supply chains in ways that defy expectations of a rapid decoupling.

The Engine of Growth: Clean Tech and Semiconductors

China's clean technology exports hit a record $20 billion in August 2025, driven by a 26% surge in EVs and a 23% increase in battery shipments, according to an Electrek report. Solar photovoltaic (PV) exports, while growing in volume (46 gigawatts in 2025), faced a 19% drop in value due to plummeting panel prices-a testament to China's ability to dominate through scale and cost efficiency, according to an Ember analysis. These sectors, often termed the "new three" (solar, batteries, EVs), now account for over 80% of global solar cell exports and more than 50% of lithium-ion battery exports, as the Rhodium Group reports.

The Belt and Road Initiative (BRI) has further cemented China's influence, with BRI countries seeing a 20% rise in trade with China in 2024, according to Silk Road Consulting. This expansion is not merely quantitative but qualitative: Chinese firms now supply critical inputs for "Made in Vietnam" or "Made in India" goods, blurring the lines between localized production and China's deep integration into global supply chains, the Atlantic Council argues.

The Limits of De-Risking: Vietnam, India, and Mexico

Efforts to "de-risk" supply chains by shifting production to Vietnam, India, and Mexico have yielded mixed results. Vietnam, for instance, has attracted $11.6 billion in semiconductor-related FDI since 2023, with Intel, Amkor, and VinFast establishing operations, according to Vietnam Briefing. Yet, infrastructure bottlenecks and reliance on Chinese raw materials persist. Similarly, India's "Make in India" initiative has drawn $10.2 billion in semiconductor investments through its Semicon India Program, per IBEF, but localization of EV components remains at just 30–40%, S&P Global reports. Mexico's FDI in semiconductors reached $12.9 billion by 2024, yet its role is largely as a nearshoring hub for U.S. markets rather than a full-scale replacement for China, according to Mexico's Ministry of Economy.

The "China Plus One" strategy-diversifying supply chains without fully abandoning China-has become the norm. As BCG found, 90% of North American companies have shifted some production out of China, but the transition is more about balancing risk than replacement. China's logistics infrastructure, labor force, and supplier ecosystems remain unmatched, allowing it to retain a third of global manufacturing output, the Times of India notes.

Geopolitical Tensions and the Path Forward

The U.S.-China trade conflict has added layers of complexity. Export controls on Huawei and forced stockpiling by Chinese firms have disrupted semiconductor supply chains, according to Foley & Lardner, while retaliatory measures from Beijing have exacerbated tensions. Yet, China's dominance in clean technology-driven by early government support and economies of scale-has made its exports indispensable, particularly in emerging markets. For example, ASEAN nations imported 75% more Chinese EVs in 2025, and African markets saw a tripling of EV imports, The Diplomat reports.

The challenge for adversaries is clear: while tariffs and diversification can slow China's ascent, they cannot replicate its scale. As one Bloomberg analyst puts it, "China's clean tech exports are not just about today's prices-they're about tomorrow's infrastructure."

Conclusion

China's resilience in global trade is not a static phenomenon but a dynamic interplay of strategic investments, geopolitical maneuvering, and supply chain realities. While the trade war has spurred diversification, it has also highlighted the difficulty of replacing a system as entrenched as China's. For investors, the lesson is clear: betting against China's dominance in strategic commodities may be a losing proposition-unless alternative hubs can overcome their infrastructure and efficiency gaps.