CNA: China’s Share of the Global Economy has Shrunk Significantly
Primary Taiwanese news agency Central News Agency (CNA) recently reported that, China’s export trade is robust, and many of its industries lead the world. However, due to the double blow of domestic deflation and a weakening yuan, China’s share of the global economy has shrunk significantly.
In dollar terms, China’s GDP accounted for a peak of approximately 18.5 percent of the global economy in 2021, at which time its economy was about three-quarters the size of the United States. Many economists predicted that China’s explosive growth would eventually make its economy surpass that of the United States. Contrary to expectations, China’s share of the global economy has now declined, falling to approximately 16.5 percent by the end of 2025. According to the International Monetary Fund (IMF), China’s current economy is less than two-thirds the size of the United States.
However, the combined effects of domestic deflation and a weakening yuan have reduced the relative size of the Chinese economy, denominated in US dollars. Deflation has lowered the value of goods and services in the economy. As a result, even though China produces a record number of goods, the dollar value of its output has stagnated.
For multinational corporations, the shrinking share of China in the global economy is worrying, as the returns they receive from their investments in China have shrunk when converted into US dollars.
Source: CNA, March 20, 2026
https://www.cna.com.tw/news/acn/202603200296.aspx
Europe’s Auto Giants Lose Ground as China Closes the Gap
For decades, European automakers dominated the global car market — but that dominance is now eroding fast. According to an analysis by Ernst & Young (EY), reported by Germany’s Der Spiegel, the European Union imported more cars and auto parts from China last year than it exported there for the first time ever. EU exports to China fell 34% to €16 billion (roughly $17.4 billion), having been cut in half since 2022, while imports from China rose 8% to €22 billion (roughly $23.9 billion). A trade surplus once worth tens of billions of euros has flipped into a deficit in just a few years.
German automakers are feeling the pressure too. Exports to China have dropped from a record €30 billion ($32.6 billion) in 2022 to €13.6 billion ($14.8 billion), while imports from China have grown by two-thirds to €7.4 billion ($8 billion). EY warns that if current trends continue, exports and imports could reach parity by 2026. Chinese brands have yet to make major inroads in Germany itself — Volkswagen, Mercedes-Benz, and BMW have held their ground — but they have advanced significantly elsewhere in Europe, and further competitive pressure is expected.
The troubles extend beyond trade balances. Germany’s auto industry saw revenues fall 1.6% in 2025 to nearly €528 billion ($574 billion), with profits declining sharply in some cases. Employment dropped 6.2%, or nearly 50,000 jobs, to around 725,000 — the lowest level in 14 years. Major layoff plans are underway at Mercedes-Benz, Volkswagen, and suppliers including Bosch and Mahle. Suppliers have fared even worse, with revenues down 4% and employment falling more than 10%. Since 2019, nearly one in four supplier jobs has disappeared — some 73,000 positions in total.
EY attributes the crisis to a combination of rising Chinese competition, weak export markets, sluggish economic growth, geopolitical instability, and underwhelming electric vehicle demand, compounded by Germany’s high operating costs and bureaucratic hurdles.
Source: Radio France International, March 21, 2026
https://rfi.my/CY3R
China Highlights Combat Capabilities of Type 055 Destroyers
China’s Ministry of National Defense reported that the People’s Liberation Army (PLA) Navy’s Type 055 guided-missile destroyers have developed large-scale, system-level combat capabilities. The Type 055, often referred to as a “10,000-ton-class destroyer,” is considered a milestone in the modernization of China’s naval forces, with a full-load displacement exceeding 12,000 tons.
According to the report, the warship is equipped with an advanced universal vertical launch system (VLS) capable of deploying multiple types of missiles, providing robust capabilities in air defense, anti-ship, anti-submarine, and land-attack operations. The platform is designed to serve as a core component of carrier strike groups and to support integrated naval operations, reflecting China’s growing emphasis on modern, network-centric warfare.
The article highlights that Type 055 destroyers have entered scaled deployment and operational integration, signaling a transition toward more mature and coordinated naval combat power. Notably, two new “10,000-ton-class” destroyers, hull numbers 109 and 110, have recently begun combat-oriented training, further underscoring the PLA Navy’s expanding operational capabilities.
Source: China’s Ministry of Defense Website, March 21, 2026
http://www.mod.gov.cn/gfbw/qwfb/16450238.html
Chinese “Wolf Warrior” Diplomat Geng Shuang Reassigned from Key Post
An article by Creaders reports that Chinese diplomat Geng Shuang, formerly China’s Deputy Permanent Representative to the United Nations, recently made his first public appearance after being reassigned as Vice President of the China Public Diplomacy Association. During the event, he met with the president of the American Chamber of Commerce in China, marking his first official engagement in his new role.
The report notes that Geng’s transfer from a frontline diplomatic position at the United Nations to a role in a semi-official organization has drawn attention. Although the move is considered a lateral shift in rank, it places him outside direct involvement in China’s core diplomatic activities. Geng previously served as a spokesperson for China’s Ministry of Foreign Affairs and was associated with the country’s “wolf warrior” style of diplomacy, known for its assertive and often combative responses to international criticism.
Observers cited in the article suggest the reassignment may be intended to create a softer diplomatic environment ahead of a potential visit by U.S. President Donald Trump to China, indicating a possible shift away from a more confrontational approach following recent U.S. actions in Venezuela and the ongoing war with Iran.
Source: Creaders, March 16, 2026
https://news.creaders.net/china/2026/03/16/2982402.html
OpenAI Report Raises Concerns Over Alleged Chinese Overseas Intimidation Campaign
The Epoch Times reports that a recent OpenAI report uncovered an alleged large-scale overseas influence and intimidation campaign linked to Chinese authorities. According to the report, details of the operation were inadvertently exposed when a Chinese law enforcement officer used ChatGPT as a logbook, recording information about these activities.
OpenAI stated in its February report that it identified the covert operation through these records. One case reportedly involved impersonating U.S. immigration officials to intimidate Chinese dissidents living abroad. In another instance, Chinese operatives used fabricated documents purporting to be from a U.S. county court in an attempt to persuade a social media company to shut down a dissident’s account—although the effort was unsuccessful, it illustrated a potential tactic. The report also noted the use of AI tools to generate large volumes of deceptive or fabricated content, including false death reports and defamatory messages targeting Chinese dissidents.
The findings raise concerns that such activities could extend beyond traditional propaganda into more direct forms of intimidation and transnational repression. Analysts cited in the report warn that the use of artificial intelligence in this context highlights broader risks regarding the misuse of AI in global political and security environments.
Source: Epoch Times, February 26, 2026
https://www.epochtimes.com/gb/26/2/25/n14706053.htm
UDN: Apple Sales Bucked the Chinese Market Trend, Surging 23 Percent
United Daily News (UDN), one of the primary Taiwanese news groups, according to data released by market research firm Counterpoint, Apple’s smartphone sales in China surged 23 percent in the first nine weeks of this year, bucking the trend of an overall market downturn and price increases by some Android phone brands due to rising memory chip costs.
From January to early March this year, China’s overall smartphone market shrank by four percent compared to the same period last year. Even with government subsidies introduced at the beginning of the year, it was unable to effectively boost weak consumer demand.
The Counterpoint report indicates that Apple’s strong control over its supply chain allows it to withstand the pressure of soaring memory chip costs more effectively than its competitors. Counterpoint anticipates that Apple will maintain its current pricing while competitors raise prices. The report stated “Apple is unlikely to follow suit with price adjustments; instead, it will absorb some of the profit pressure itself, thereby expanding its market share.” The Chinese smartphone market is expected to continue facing pressure between March and May.
Source: UDN, March 19, 2026
https://money.udn.com/money/story/5599/9390143
China’s Solar Panels Help Cuba Weather U.S. Energy Pressure
In late January, President Trump signed an executive order authorizing tariffs on countries that sell or supply oil to Cuba, part of a broader effort by Washington to tighten its energy blockade on the island. Cuban authorities believe the U.S. aims to make living conditions unbearable for the Cuban people through such measures. The country has experienced severe electricity disruptions as a result — on March 16, Cuba reported a complete nationwide power outage that took over a day to partially restore.
China has stepped in to help fill the gap, primarily through solar energy. According to U.S. media reports, Chinese solar panels already installed or being installed across parts of Cuba can supply up to 10 percent of the country’s electricity needs. More than 90 solar farms are expected to be completed by 2028, which could help Cuba partially offset U.S.-imposed oil restrictions. On March 11, China’s Ambassador to Cuba visited three Havana clinics equipped with Chinese medical and energy equipment, reaffirming Beijing’s willingness to support Cuba’s energy transition.
The scale of Chinese solar panel exports to Cuba has grown dramatically. China, which produced 80% of the world’s solar panels in 2024, exported just $3.86 million worth of panels to Cuba in 2020. That figure rose to $48.37 million in 2024, before surging to $117.27 million in 2025 — a 142.4 percent year-on-year increase and a staggering 2,938 percent jump compared to 2025. In terms of capacity, exports climbed from 0.01 gigawatts in 2020 to 1.17 gigawatts in 2025, a 160 percent rise from the prior year.
Cuba is well-suited for solar energy, averaging around 330 sunny days per year. China’s leading solar manufacturers — including JinkoSolar, LONGi, Trina Solar, JA Solar, and Tongwei — are positioned to play an even greater role in supporting Cuba’s energy future.
Source: Sputnik News, March 20, 2026
https://sputniknews.cn/20260320/1070354363.html
China’s Port Inspections Target Panamanian Ships in Apparent Retaliation
China has significantly ramped up port state control (PSC) inspections of Panamanian-flagged vessels, detaining 44 ships between March 1 and 18 — roughly three times the number detained during the same period last year, according to data from the Tokyo Memorandum of Understanding (Tokyo MOU), a 22-member regional port authority body that includes both China and Panama.
The surge appears to be Beijing’s response to Panama’s decision to strip Hong Kong-based CK Hutchison Holdings of its operating rights at two ports along the Panama Canal. Between March 8 and 12 alone, Chinese ports detained 28 Panamanian vessels, accounting for 75.7 percent of all detentions — far above historical norms, according to shipping publication Lloyd’s List.
What makes the crackdown particularly striking is its selective nature. Tokyo MOU data shows that many of the detained Panamanian ships were classified as “general risk” or “low risk,” while higher-risk vessels of other nationalities were largely left alone. In the same period last year, only high-risk Panamanian ships were detained. Chinese maritime analysts have noted that vessels which would not normally be subject to inspection are now being boarded, though Beijing’s use of legal mechanisms gives Panama little formal grounds for complaint.
The economic consequences could be severe. A WeChat maritime account estimated that each detained vessel faces an average daily demurrage cost increase of approximately $18,000. More broadly, analysts warn that shipowners may increasingly consider re-flagging their vessels away from Panama to avoid prolonged political and operational risks.
Panama, the world’s second-largest flag-of-convenience state with over 8,000 registered vessels, earns an estimated 3% to 5% of its national revenue from ship registration and annual fees — its second-largest stable income source after Panama Canal tolls. A large-scale exodus of Panamanian-flagged ships would deal a serious blow to the country’s public finances.
Source: Central News Agency (Taiwan), March 20, 2026
https://www.cna.com.tw/news/acn/202603200300.aspx