The 2026 edition of The Economist’s annual ‘The World Ahead’ report was released online on 10 November 2025. Between political sentiment in the US, the growth in popularity of weight loss drugs, a blurry picture of climate policy, and fragile peace alongside relentless conflict, one trend stood out in the world of global trade: China’s opportunity. 

Trade Finance Global (TFG) spoke to Tom Standage, Editor of The World Ahead at The Economist, to find out more about the country’s position in global trade networks. In particular, Standage discussed how China presents itself as a reliable, flexible alternative to – rather than replacement for – the US, which dominated global trade and sustainable energy networks for so long until its aggressive, tariff-heavy trade policy closed it off. 

Mahika Ravi Shankar (MRS): As ‘The World Ahead 2026’ notes, the US is celebrating its 250th birthday; China, though, has been united as a single imperial state since around 200 BC. In the trade domain, do you think the country’s past and traditional financial characteristics say anything about its present and future?

Tom Standage (TS): I’m a big fan of lessons from history, but I’m not sure that’s a terribly helpful prism to understand what is happening now, which is really quite specific to the present day. Two things stand out. First, that China dominates manufacturing in clean tech, notably batteries, solar panels and EVs, and aims to be just as dominant in the global supply of future technologies. And second, that current US policies (imposing tariffs, withdrawing aid) have given China a huge opportunity to increase its global influence, particularly across the Global South, including through trade. Those are the dynamics that matter right now, and in the coming years.

MRS: In The Economist’s ‘The World Ahead 2025’, published this time last year, Roger McShane wrote that “China can ill afford a trade war of any kind.” To what extent has the trade war which has unfolded this year proved McShane right?

TS: I think Roger was referring to the fact that China’s domestic economic problems (deflation, property-market crisis) meant that it wanted to avoid getting into a trade war if possible, because it was relying on exports to drive growth. So that was a potential point of vulnerability. But if we look at what has actually happened in 2025, China has clearly outplayed the US in the trade war. It has found alternative markets for its exports, is now presenting itself to other countries as a more reliable economic partner than the US, and, most significantly, has successfully weaponised its control of rare earths to increase its leverage over the US. Those shifts are here to stay. China, you might say, has already pounced.

MRS: Tensions in the South China Sea were heating to a boiling point by the end of the year. In nineteenth-century trade, the Sea was crucial in connecting East Asia to India and the West; what could be the implications for the maritime industry of the South China Sea becoming a flashpoint in the coming years? What about the implications on US-China-Philippines-Taiwan relations and international trade dynamics?

TS: Xi Jinping, President of the People’s Republic of China, is thought to have told China’s armed forces to be ready to invade Taiwan by 2027, should the order be given. But rather than a full invasion, a blockade, or an intensification of the current “anaconda” strategy, it seems far more likely. 

Whether the US would come to Taiwan’s aid in the event of China trying to cut it off is one of the big unknowns in geopolitics right now. Any move on Taiwan would have huge implications because Taiwan’s allies would probably retaliate with sanctions against China, disrupting global trade. The prospect of being cut off from energy supplies in the Gulf (if the Malacca Strait were closed) is one reason why China has built a pipeline through Myanmar. 

If Xi wanted to test American resolve, one way to do it would be to engineer a clash with the Philippines, which is a treaty ally of the US. Something to watch for in 2026 is whether US President Donald Trump’s desire to do business with China leads to an erosion of support for Taiwan – particularly if a weakening American economy makes it more important for Trump to strike a big trade deal with China.

MRS: Can you please discuss the progress which has been made on China’s Belt and Road Initiative (BRI), and in particular its investment strategies in the Global South? 

TS: China had gone a bit quiet about the Belt and Road Initiative. The initial projects didn’t go well, and there were concerns that partner countries were ending up in debt to China. So then there was a pivot towards “small but beautiful” projects, with an emphasis on digital infrastructure and green energy. It looked as though the BRI was winding down. But it has bounced back in the last couple of years, and is now central to China’s efforts to strengthen ties with countries in Africa and elsewhere in the Global South as the US’s trade war forces it to divert its exports elsewhere. It’s a way of drumming up business for Chinese companies. In addition, BRI partners are also expected to support any Chinese moves towards “unification” with Taiwan.

MRS: China has achieved substantial progress toward its green transition objectives while simultaneously establishing itself as the world’s leading manufacturer of renewable energy technologies. Its green bond market has now surpassed those of Western competitors, positioning China favourably in the global energy transition landscape. Given the recent pullback on environmental, social, and governance (ESG) initiatives in the US, how do you anticipate China’s role in global sustainable development will evolve? What are the broader implications of this shift for global trade dynamics and climate leadership? For instance, regarding the China-Africa trade relationship surrounding the critical minerals and raw materials essential for renewable energy technologies.

TS: Climate is another area where the US has abdicated its leadership role. Although China is still the world’s largest emitter, its emissions are now falling, and as a result, global emissions are falling. China is the largest supplier of clean tech in the world, exports of which are driving a clean-tech boom across the global south. At home, China is also installing more wind and solar capacity each year than the rest of the world put together. It has also committed itself to emissions cuts by 2035 – setting targets it will easily overshoot. It is a bit of an exaggeration to say that “affordable clean tech from China will solve the climate crisis” – but not much of one, because that is broadly what is happening. 

While this is good news for the planet and for Chinese exporters, it is not good news for everyone. Countries that wish to defend their own industrial firms (like makers of solar panels in Nigeria, or electric cars in Europe) are imposing tariffs and other trade barriers. On rare-earth elements, China has successfully weaponised its control of their extraction and refining in order to win trade concessions elsewhere. Some of these elements come from Africa. The rest of the world is now looking to develop its own supply chains, and resource-rich countries may be able to demand better terms. But the process will take years.

MRS: Looking back from the year 2050, what do you think will be the single biggest change between now and then in terms of China in global trade networks?

TS: China’s goal is to remain the world’s manufacturing centre. It wants to be both self-sufficient and indispensable to the rest of the world, so that it controls its own destiny. That is the direction of travel. It is moving up the value chain in more and more industries. Already the leader in clean tech and consumer electronics, it will catch up in areas like chipmaking and aerospace in the next 10-15 years and increase its reach in global markets. 

The big question is the extent to which it leverages its industrial and trading heft into political influence. The US’s trashing of its global brand with attacks on universities and science, its withdrawal of foreign aid, its dysfunctional political system, its imposition of tariffs even on its allies, and its mafia-style approach to foreign alliances are all an absolute gift to China as it pursues these long-term goals.