中国的产能过剩挑战

China's overcapacity troubles High inventories, price declines, and under-utilisation to pushlocal producers to look for alternative, overseas markets - anunintended consequence of the anti-involution policy. Assuch, fertilisers, household appliances, and integratedcircuits look vulnerable. Asia Credit Research Roanna Chau+852 2903 2625roanna.chau@barclays.comBarclays Bank, Hong Kong Jit Ming Tan, CFA+65 6308 3210jitming.tan@barclays.comBarclays Bank, Singapore Anti-involution matters: The policy intends to break the domestic cycle of price wars,overcapacity, and margin erosion in China. As China's approach to economic growth is driven bythe production side, industrial policy support for the manufacturing sector to expand meansmuch of the additional output will have to go abroad. Accordingly, we expect this movement ofgoods (exports from China) to accelerate and expand to more sectors in 2026. Imtiaz Shefuddin+65 6308 4906imtiaz.shefuddin@barclays.comBarclays Bank, Singapore Tracking and mapping the sectors: Sectors facing significant overcapacity include cement,steel, chemicals, alumina and aluminium, lithium-ion batteries, new energy vehicles, and solarcells. Meanwhile, industries showing increasing vulnerability include fertilisers, householdappliances, and integrated circuits. Asia Credit StrategyAvanti Save, CFA+65 6308 3116avanti.save@barclays.comBarclays Bank, Singapore Approach: We begin by reviewing China's Five-Year Plans to identify priority sectors/industriesthat likely benefited from strategic focus and were designated as central to economicdevelopment. We then collected a comprehensive set of data points to capture both tradeperformance and underlying production dynamics. China Economics Ying Zhang+852 2903 2652ying.zhang3@barclays.comBarclays Bank, Hong Kong Overcapacity by design A new domestic policy...The term“involution”(内卷,neijuan) refers to a cycle of excessivecompetition where firms expend increasingeffortand resources without achieving proportionalreturns. In China’s economic context, this manifests as price wars, overcapacity, and marginerosion. The anti-involution campaign is Beijing’s policy response aimed at breaking this cycle.It seeks to curb irrational competition, restore profitability, and stabilise industrial developmentthrough regulatory measures, capacity optimisation, and market discipline. ...with some unintended consequences.First, as intended, outcomes for some domesticplayers could be positive as tighter regulations could foster healthier market dynamics andencourage more sustainable business practices (specifically subsidy-driven competition, pricingstrategies and promotional activities). Second, domestic producers will have to navigate higherinventories, price declines, and potential underutilisation, coupled with sluggish domesticdemand, which, in turn, will likely push them to look for alternative, overseas markets - anunintended consequence. As a result, we expect this movement of goods (volume of exportsfrom China) to accelerate and expand to more sectors in 2026. In turn, for the rest of the world,the ongoing anti-involution campaign could increasingly feel like being at the receiving end ofa 'destocking of excess capacity', in our view. Source:OfficialWebsites, Media reports, Barclays Research; China: Anti-involution takes the limelight, 28 July 2025 Mapping and tracking theseshifts. We discuss a simplified approach to track and identifysectors/industries that may face disruptions from these developments in China. We begin byreviewing the Five-Year Plans that are central to the country's economic development strategy:national priorities, road map for sectors/industries, and policy framework for localgovernments/SOEs/private sector to align strategy and allocate resources. We then examineexport volumes and values across a range of sectors/industries/product categories, whichhelped us identify sectors and products that are exhibiting significant growth or decline. To provide additional context, we then incorporated supporting indicators such as the ProducerPrice Index (PPI), output levels, capacity utilisation, and inventory data, which togetherofferedinsights into pricing trends, production strength, and supply-demand conditions. For exportvolumes, PPI, output, and utilisation data, we made historical comparisons using twobenchmarks: a two-year average and a five-year average. For export values, we compared the2024 average against the 2025 year-to-date (YTD) average to assess recent performance. Step 1: Five-year Plans A lot of clues in Five-Year Plans.Overcapacity problems in China are not just a function ofproduction cycles. They are borne out of specific government policies: the Five-Year Plans(Figure 3) lay out the strategic direction for the economy, highlighting top priority sectors/industries while detailing a number of policy tools, regulations and incentives (subsidies, inexpensive financing, tax benefits) to be provided to those ar