Berlin, Germany (Weltexpress). In the trade war unleashed by the US, China is conquering the global South, writes China analyst Micelangelo Coccu in an article in ‘China Review’, which was republished by the communist magazine ‘Contropiano’ on its online portal on 28 August 2025. This is evidenced by the emergence of a ‘new global trade order’ from the increasingly dense trade network between China and emerging economies in response to US protectionism and growing geopolitical tensions. The author argues that this is supported by a study by Standard & Poor’s, which highlights that Chinese exports to the Global South have doubled since 2015, especially since the trade war (2018-2019) unleashed by the first Trump administration. According to a report by the US rating agency (China Inc. is heading for the Global South in the age of tariffs), Beijing’s exports to the Global South have risen by 65 per cent in the last five years, tripling compared to the previous five years. In contrast, Chinese exports to the richest markets, the US and Western Europe, have grown by ‘only’ 28 and 58 per cent respectively over the last decade.Currently, the value of Chinese exports to the southern hemisphere amounts to 1.6 trillion US dollars, 50 per cent more than China’s total exports to the US and Western Europe, which amount to one trillion US dollars. According to Coccu, this trend is likely to continue. The combination of Donald Trump’s new tariffs on US imports and the weakening Chinese economy will increasingly prompt Chinese companies to sell their products in emerging markets.According to Standard & Poor’s (S&P), the result could be a new global trade order in which South-South trade becomes the new focus and Chinese multinationals emerge as important new players. The central role that the global South plays for China is not limited to trade.
Chinese investment in countries primarily in Asia, but also in Africa and Latin America, is also growing steadily and massively, especially in the manufacturing sector. For example, inflows to China’s four largest trading partners in Southeast Asia – Indonesia, Malaysia, Thailand and Vietnam – have quadrupled over the last decade, reaching an average of $8.8 billion annually.
According to the S&P study, these investments are likely to continue even in the age of tariffs, not only to avoid new taxes or secure resources, but also to tap into end markets and reduce dependence on US sales. This diversification strategy may be one of the few viable ways to cope with the increased uncertainties in the age of tariffs.
The S&P report highlighted Indonesia as the case where ‘Chinese companies could most clearly align their investments and business activities with local development goals.’ The Asian country has indeed used capital inflows to rapidly expand its nickel industry and advance the electric vehicle supply chain.
Chinese car manufacturers have also rapidly expanded their market presence, benefiting from the energy transition in South and Southeast Asia. Sales increased thirteenfold in Malaysia, doubled in Thailand, Indonesia and the Philippines, and grew by over 50 per cent in India and Vietnam over the last three years. According to the analyst, the US rating agency’s report highlights that China’s expansion in developing countries is evident in numerous sectors, including engineering, construction, machinery, equipment, consumer goods and services. ‘The new US tariffs may not be the direct cause, but they act as a general accelerant,’ said S&P analysts. The document also highlights several risks that Chinese companies face when expanding abroad. These include: unknown business partners, less developed legal systems and infrastructure, local concerns that Chinese companies may sell goods at excessively low prices to drive out competitors, regulatory controls, and sanctions or countervailing duties.Despite these challenges, S&P analysts expect the trend to continue as companies ‘seek to diversify their sales outside the US and expand into other markets with better growth prospects than their domestic markets’.
