The rising tensions come at an inopportune time. Stocks were starting to emerge from a multi-year slump as investors bought into China’s efforts to build new growth engines and achieve self-sufficiency along key supply chains. A materialization of those threats can hinder China’s global expansion, while tit-for-tat responses from Beijing may bring about a full-blown trade war that would drastically alter the investment landscape.
China’s most promising industries are facing a growing threat of trade restrictions from Western governments, blurring the outlook for stocks that have the potential to fuel the nation’s market growth.
The sectors under scrutiny by Europe and the US are as wide-ranging as electric vehicles, wind and solar projects, medical devices and chips, but have one thing in common: they are of strategic importance to President Xi Jinping’s bid for leadership in the global race toward green transition and high-tech development.
