By Marc Vandepitte
November 27, 2025

The influential business magazine The Economist draws a striking conclusion: while the U.S. hesitates and Europe wavers, China is thundering into the green future with solar farms, batteries, and electric cars. If the climate summit in Belém [Brazil] proves anything, it’s this: without Chinese hardware the world will not meet its climate goals.

The world faces an unprecedented energy transition. While the current U.S. administration rejects renewable technology, industry in Europe is retreating and green plans are being rolled back. That is why the climate struggle will be decided in the Global South, and there, Chinese renewable solutions will make the difference.

That is the remarkable conclusion The Economist draws in a special report on the climate on the occasion of the climate summit in Belém. The Economist is one of the most influential business magazines in the world. The magazine is anything but a “China lover,” but notes with a heavy heart that the U.S. and Europe are not willing or able to drive the global energy transition.

And that is precisely the question around which this climate summit revolves.

The EV Revolution

Other mainstream media are on the same wavelength as well. For example, De Standaard in Belgium (Nov. 7) describes how Wan Gang, the minister of Science and Technology, in 2009 launched a strategy that pushed China’s lagging car industry into the electric age. With emission standards, charging infrastructure, and billions of dollars in support, a domestic market was created in which electric driving could become the norm.

Wan saw early on how oil dependence, air pollution, and the technological hegemony of the U.S. made China vulnerable. The solution was industrial policy with a long-term horizon in which the government steers and industry scales up.

That policy was particularly successful and catapulted China to the world top in this sector. In 2024, 6.4 million electric cars were sold in China, three times as many as in Europe and five times as many as in the U.S. More than 60% of all electric vehicles (EVs) now come from Chinese factories, and well over 70% of the batteries also roll off the line there.

The once-laughed-at BYD overtook Tesla. Battery giant Contemporary Amperex Technology Co., Limited (CATL) showed off a cell that promises 500 kilometers [310.7 miles] of range after five minutes of charging.

The low price of Chinese electric cars is not only the result of technology but also of organization: Sharp competition, automation, and vertical integration – from raw material to shipping – push down the cost price. Today, two out of three Chinese EV models are already cheaper than their fossil counterparts, even without subsidies, notes De Standaard.

Laboratory for green technology

The Economist widens the lens further. At the end of last year, China had 887 gigawatts of solar capacity, almost double that of Europe and the U.S. combined. In 2024 alone, 22 million tons of steel went to wind and solar, enough to build a Golden Gate Bridge on almost every working day.

China can produce almost one terawatt of renewable capacity per year, the equivalent of more than 300 large nuclear power plants. That scale is no coincidence, but the result of a flywheel: enormous domestic demand, ever more efficient production, falling prices, even more demand. Subsidies that set the wheel spinning are meanwhile being phased out.

The result is cheap and abundant energy, which moreover is generated domestically. The latter is strategically very important because dependence on, for example, foreign oil then decreases and in the long run even disappears.

Solar panels are the textbook example. The U.S. invented them, but today China accounts for 90% of global capacity and installs more panels than the rest of the world combined (The Economist, Jan. 16). Whereas Europe and the U.S. struggle with fragmentation and expensive inputs, China sets up clusters where the entire process takes place.

In wind energy the lead is smaller, but still impressive. In 2021 alone, China installed more offshore wind capacity than the rest of the world combined in the five years before that. The four largest wind turbine manufacturers today are Chinese.

The lead is also growing in heat pumps. In 2024, Chinese companies produced more than half of the world’s heat pumps, with a significant share destined for the export market.

According to The Economist, China has become the world’s laboratory in the field of green technology. Last year, $676 billion was invested in this area in China, accounting for 38% of the global total and more than double the amount invested in the U.S. (March 12, 2024)

The rest of the world is largely dependent on Chinese supply chains for solar panels and batteries. (The Economist, Nov. 27, 2023)

Good reasons to promote climate policy

China has strong reasons to prioritize climate policy: major cities like Shanghai lie on the coast and risk flooding due to rising sea levels, the arid north struggles with water scarcity, and extreme weather is already causing damage.

According to the medical journal The Lancet, the number of heat-related deaths in China in 2022 was 3.5 times higher than the historical average. In the summer of 2023, floods destroyed a large part of China’s wheat harvest.

Investment in green energy is also economically attractive. China is lowering its domestic energy intensity while simultaneously exporting its transition. Today, the country earns more from the export of clean technology than the U.S. does from the export of fossil energy.

In August [2025] alone, $20 billion worth of clean tech was shipped around the world. Half of the exported electric cars ended up in developing countries. In many of those markets, China already achieves a market share of around 75%, notes De Standaard. This trend will continue, simply because renewable energy sources are cheap.

In the Global South, the large-scale Chinese investment project, the Belt and Road Initiative, is shifting from coal plants and mega-ports to solar and wind projects. Cheap panels and batteries are turning rooftops in countries like Pakistan into mini power plants.

For many governments in the South, one criterion counts: security of supply at a low price. Solar cells have an extra advantage there: Once installed, no one can “turn off the tap.” That reduces the geopolitical blackmail power that always played a role with oil and gas, and lays the foundation for their own energy sovereignty.

This export does exactly what is needed for China: it lowers global emissions and reduces its own climate risks, while feeding industry and trade. According to the think tank CREA, investments in green energy were the main driver of economic growth in China in 2023. For the first time, the economic and climate incentives of the world’s largest manufacturer largely coincide.

The Financial Times therefore calls China the world’s first “electrostate”: green technology as a crowbar to conquer world markets. Beijing’s intensive quest for energy self-sufficiency could even give the country the upper hand in the trade war with the U.S.

On the right track

Not everything is rosy. China is not moving away from coal as quickly as environmental activists would like or analysts deem necessary to meet the 2060 target (The Economist, Nov. 27, 2023). Sixty percent of the energy mix still comes from this most carbon-intensive energy source. After the Russian invasion of Ukraine, an average of two new plants per week were approved, and they will remain in operation for decades.

Still, something is shifting. De Standaard points out that in the first half of this year China managed to cover its additional electricity demand entirely with renewable sources and that fossil fuel consumption was declining in absolute terms. The most polluting phase of China’s development is probably behind it.

According to the newspaper, the electrification rate of the economy there is now above 30% versus just over 20% in the U.S. China is announcing a moderate emissions reduction by 2035 and more often exceeds its own targets than it misses them, according to the paper.

China is far ahead of the 2030 targets for renewable energy. The milestone of 1,200 GW [gigawatts] of wind and solar has already been reached this year, and emissions appear to have peaked since March 2024. (CREA, Sept. 25)

How China became the green world leader

China’s leap in the energy transition was no fluke and is the result of a long-term vision and the rapid economic growth of recent decades. The country combined social investments, smart openness, and hard planning with market incentives. The result was an economy that has scale, speed, and direction at the same time.

First the social foundation. From the start, a lot of money flowed to education, healthcare, and social security. That produced healthy, educated workers. And importantly: wages followed productivity. In this way, social peace was preserved and a large, dynamic domestic market emerged.

On top of that came a turbo: infrastructure and technology. A network of rail, roads, ports, and energy was built out at high speed. At the same time, China invested massively in research and development. The country shot to the top in scientific publications and patents, and graduates every year a multiple of STEM students. This leap in knowledge feeds industries with high added value.

Openness played a role, but always on its own terms. Foreign investors were welcome, as long as they contributed to national goals: technology transfer, local sourcing, and jobs. Trade became a means, not an end. The New Silk Road fits into that same logic: opening markets and anchoring Chinese capacities.

The core of the steering remains state-led. Five-year plans set the direction, state banks push capital toward strategic sectors, from energy to chip production. When the government gives priority – think of solar energy – the mobilization of producers follows quickly. In this way, China was able to become a world leader in solar panel technology and the production chain in a short time.

At the same time, China is surprisingly decentralized. Local governments manage the bulk of expenditures and compete with one another. Provinces and cities experiment; If they score well, others copy them. Companies compete on the market, internally and worldwide. This double competition –- between regions and between companies – keeps the system agile.

Market forces are therefore not a taboo, but an instrument. As long as the market serves societal and strategic goals, it is given space. If it clashes with those goals, the state intervenes. In this way, China avoids the inefficiencies of pure centralization, but also the rudderlessness of a “free” market without direction.

It was crucial that China saw early on that the world economy would move toward greening. The shift to renewable energy, electric mobility, and energy efficiency was placed at the top of the agenda. In addition to its scale advantage, China thus has cost reduction and technological leadership in green sectors, while at the same time reducing its dependence on imported fossil fuels.

What will Europe do?

Europe does not have to copy this model, but can learn a great deal from it. In addition, our continent faces an important choice: Do we opt for the far too expensive fossil backstop of the U.S. or for Chinese green hardware?

The production of solar panels has largely moved to China, fossil reserves are limited, and political support for expensive transition packages shows cracks. Attempts to build our own strong green energy champions are faltering. De Standaard points in that regard to the bankruptcy of battery producer Northvolt as a warning signal.

Be that as it may, Europe cannot possibly achieve its climate targets without China. It might follow The Economist’s advice (Nov. 6): “Even if climate change is not your priority, you should be excited at the prospect of cheap, abundant clean energy and its promise to improve billions of lives in developing countries. The world needs what China has to offer. It should take it.”