Global Lessons from China's Industrial Policy Amid Geopolitical Tensions

• •China's industrial policy combines support for advanced and declining sectors, creating inefficiencies.
• •Policymakers globally risk misapplying lessons from China due to incomplete understanding of its model.
• •Effective industrial policy requires clarity of purpose to address specific economic challenges.

China's industrial policy is under scrutiny as global policymakers seek to navigate geopolitical tensions and supply chain disruptions. The focus is on understanding the complexities of China's model, which includes significant state support for both cutting-edge and declining sectors, primarily through state-owned enterprises. This model has led to substantial fiscal burdens and inefficiencies, while also enabling rapid commercialisation of technologies. Policymakers worldwide risk misapplying lessons from China due to incomplete understanding, potentially leading to ineffective industrial strategies. The articles emphasize the importance of contextualizing policy tools to address specific economic challenges, rather than simply replicating China's approach. The lessons drawn from China's experience highlight the need for clarity in purpose when designing industrial policies.