RESEARCH & ANALYSIS

Analysis: How China Can Kick Its Overcapacity Habit

Published: Jan. 14, 2025 6:58 p.m. GMT+8

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Robotic arms work on the production line of a Volkswagen factory in Hefei, East China’s Anhui province, on March 28. Photo: Bloomberg

Robotic arms work on the production line of a Volkswagen factory in Hefei, East China’s Anhui province, on March 28. Photo: Bloomberg

China, the world’s second-largest economy, has been characterized by strong supply and weak demand since the Covid pandemic. Policymakers warned of “overcapacity in certain industries” at the Central Economic Work Conference at the end of 2023 and in the central government work report presented to the National People’s Congress in March 2024, and the issue has gained widespread attention.

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