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Explainers
July 2025

The Incredible Resilience
of the Chinese Economy

Asia
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Author
François Godement
François Godement
Special Advisor and Resident Senior Fellow - U.S. and Asia

François Godement is Institut Montaigne’s Special Advisor and Resident Senior Fellow – Asia and America. He was also a Nonresident Senior Fellow of the Carnegie Endowment for International Peace in Washington, D.C. and, until the summer of 2024, an external consultant for the Policy Planning Staff of the French Ministry for Europe and Foreign Affairs. He was the Director of ECFR’s Asia & China Program and a Senior Policy Fellow before leaving in December 2018.

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    • Faced with the US trade offensive and international tensions, the Chinese economy is showing unexpected resilience. China has managed to maintain its industrial competitiveness thanks, among other reasons, to remarkable logistical flexibility, continued deflation, and a favorable exchange rate. Even more surprising, China is rapidly diversifying its export markets, significantly strengthening its trade with ASEAN, Europe, and Africa. At the same time, the Chinese economy is accelerating its move upmarket, now dominating key sectors such as electric batteries, renewable energies, and autonomous vehicles. This hybrid industrial strategy, combining public and private sectors, and supported by constant innovation and intensive automation, is keeping China at the heart of international supply chains. However, the Chinese economy’s dependence on exports remains a structural weakness in the short and medium term. This study sheds light on Beijing's strategic choices and emphasizes the inevitable need to strengthen the European Union's internal cohesion in terms of trade defense and industrial rearmament.

    François Godement
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