Author: Xiang Bin

Published by: CaiJing Magazine

Time: 2025.12.26

The global market has undergone profound shifts. Chinese enterprises must move beyond the going global, adopting think and act globally to navigate global change to complete in global arena.

The globalization process is a complex historical phenomenon that evolves alongside changes in geopolitics and the international order. In recent years, profound shifts have occurred in the global economic landscape, geopolitical dynamics and trade regulations. The tariff threats during Donald Trump’s second term intensified global trends of trade protectionism, anti-globalization and de-globalization, further exacerbating existing issues in Sino-American relations. In this new geopolitical and external environment, the compelling question we face is what strategies Chinese enterprises should adopt to continue integrating into the global market.

Going global helped Chinese enterprises take their first steps into the global market during the heyday of globalization. However, in today’s world landscape, its limitations have become increasingly evident. For Chinese companies to further expand their presence in the global market, the only viable path forward is to elevate their perspective, adopting “think and act globally to navigate global change”. This requires a boarder vision, strategic foresight and the integration of global resources to gradually evolve into world-class enterprises. This article first divides the global market under the new landscape into three segments and explores how Chinese enterprises can adopt targeted strategies in different markets, adapt to local conditions, actively integrate global resources and truly move toward coexisting with the world.

There is an overwhelming amount of observation and discussion internationally regarding the globalization models of enterprises. This article will not address them individually. Approaching from the perspective of international order and geopolitics, observing and reflecting on the global development path of Chinese enterprises within the context of the global international economic order may provide us with a new dimension of strategic thinking, helping Chinese enterprises find more resilient and sustainable development paths in a complex and ever-changing global environment.

Chinese Enterprises Face Unprecedented Challenges in Globalization

Since the 1980s, the world has gradually entered a new globalization, beginning with the implementation of neoliberal policies by Prime Minister Margaret Thatcher in the UK and President Ronald Reagan in the US. Transcending national borders, globalization has fostered a more interdependent, open and free trading system worldwide. As Thomas Friedman pointed out in his book The World Is Flat, technological innovation and globalization together have driven the emergence of an unprecedentedly flat world, significantly reducing the constraints of geographic distance and national boundaries. In this process, a group of global enterprises has emerged, which former IBM CEO Samuel Palmisano referred to as Globally Integrated Enterprises. The globalization provides companies with unprecedented opportunities to integrate global resources, allowing them to optimize production layouts worldwide, reduce costs, access talent and technology, and expand into new markets. Over 40 years of reform and opening-up, particularly after joining the World Trade Organization (WTO) in 2001, China has actively participated in and promote globalization.

However, the global financial crisis of 2008 marked a significant turning point in the globalization. This crisis posed a major challenge to the neoliberalism and globalization previously championed by the West, prompting an increasing number of countries and individuals to engage in profound reflection on globalization. Many economies began pursuing so-called independence and self-reliance. In recent years, populist, nationalist, and extremist political forces has dealt a severe blow to investment, trade liberalization and globalization.

It should be recognized that market economies and free competition have generated unprecedented economic wealth growth worldwide, yet have also result in severe income and wealth inequality. The pandemic and technological changes have further exacerbated the entrenchment of social stratification and the widening gap between the rich and the poor. In addition, the geopolitical crisis triggered by the Russia-Ukraine conflict and the global outbreak of COVID-19 have disrupted global supply chains and hindered international investment and trade. These factors have led countries to place greater emphasis on supply chain security and economic autonomy, resulting in increased barriers in trade, investment and technology and a marked resurgence of protectionism.

Meanwhile, shifts in China-U.S. relations have had a profound impact on the global development of Chinese enterprises. As the most important diplomatic relationship of the 21st century, China-U.S. relations have evolved alongside the rise of China's economy. During the latter part of the first term of the Trump administration, relations between China and the US cooled rapidly, reaching their lowest point since the establishment of diplomatic ties. Under the Trump administration, strategies such as decoupling and severing supply chains began to be implemented. During the Biden administration, although the expression of U.S. policy toward China has been adjusted, the fundamental strategic orientation of containing China’s development has not changed, rather, the U.S. has created a more systematic pattern of containment and blockade through targeted containment with selective decoupling and by mobilizing Western allies.

Since Trump's re-assumption of office, his steadfast America First and pronounced protectionist stance have posed new challenges to global trade rules, intensifying anti-globalization and de-globalization. The Trump administration proposed the so-called Reciprocal Tariffs, using it as a bargaining tool and continually employing tariffs as a means of pressure against China and other trade partners, clearly reflecting a protectionist trade stance. In fact, the U.S.’s strategic containment of China has extended comprehensively beyond the economic and trade sphere. Through a series of targeted policies, the U.S. has sought to restrict the globalization of Chinese enterprises across multiple dimensions, including trade, investment, finance, military and security, technology and personnel exchanges.

Meanwhile, the Trump administration attempted to coerce other countries into taking sides and isolate China by pressuring allies and partner nations during tariff negotiations. The case of Nexperia confirms this point. This Dutch company, acquired by Chinese capital. Despite achieving success in technology and market performance, was ultimately suppressed by the U.S. due to geopolitical. According to public media reports, the U.S. warned the Netherlands that unless Chinese ownership was divested, the chip manufacturer would be placed on the export control blacklist. The experience of TikTok in the U.S. market similarly illustrates this issue that even after implementing deep local operations and establishing an independent data security system, it still could not fully prevent the U.S. government from demanding that ByteDance sell TikTok’s U.S. business under the data security and national security.

The challenges facing Chinese enterprises today are far more complex than those experienced by Japanese companies in the last century. Although there were multiple rounds of trade wars between the U.S. and Japan in the previous century across industries ranging from textiles and steel to automobiles and semiconductors, these were merely economic competitions between the world’s top two economies, without conflicts over geopolitics, ideology or development models. Moreover, Japan at that time (and even today) was under U.S. military control and did not possess independent military capabilities, making U.S.-Japan relations relatively straightforward. During the U.S.-Japan trade wars of the previous century, the U.S. never successfully established a unified Western alliance against Japan. In contrast, under the Biden administration, the U.S. has successfully built a Western alliance against China. Japanese companies in the 1980s and 1990s achieved globalization through substantial overseas investment, including significant direct investment in the U.S., as well as localized management. During the U.S.-Japan automobile trade wars at that time, the U.S. welcomed Japanese automakers such as Toyota and Honda to invest in establishing factories in American. However, such large-scale direct investment in the U.S. is virtually infeasible for Chinese companies today.

In this context, Chinese companies must recognize that merely overseas expansion as a Chinese enterprise or following traditional global enterprise localization is no longer sufficient to address the current complex situation. In the present international landscape, the global market is gradually showing a three-bloc global market. Chinese enterprises need to adopt flexible and adaptive strategies according to the characteristics of different markets, tailor to local conditions, and pursue in-depth development, thereby truly achieving “think and act globally to navigate global change”.

The Global Market is Divided into Three Major Segments, Requiring Differentiated Strategies.

The author observes that the global market today is divided into three major blocs. Amid rising global economic and trade uncertainties, Chinese enterprises must reassess their globalization strategies and tailor their strategies to local conditions to build a globally integrated presence. 

First, the Western-led economies led by the U.S. represent the largest market segment in the world. Data from 2024 show that final consumption expenditure reached $48.99 trillion, nearly five times that of China, accounting for 59.4% of global consumption. This market includes developed economies such as the U.S. ($23.74 trillion, 28.8% of the global total), the EU-27 ($14.44 trillion, 17.5% ), the Five Eyes Alliance (U.S., UK, Canada, Australia and New Zealand, totaling $29.99 trillion, 36.3%), Japan ($3.17 trillion, 3.8%) and South Korea ($1.16 trillion, 1.4%).

On one hand, the importance of Western markets to Chinese enterprises lies in their immense consumer market scale. Chinese manufacturing is built to serve the world. In the short term, U.S.-centered bloc accounts for nearly 60% of global consumption. Chinese manufacturing capacity cannot be sustained solely through domestic demand and emerging markets in Africa and Latin America, the consumer power of Western markets remains a key driver for the continued development of Chinese manufacturing.

Equally important, U.S.-centered West, still holds a dominant position in the global innovation system. At present, whether in pioneering breakthroughs innovations, fundamental scientific research or innovations in management concepts, the West, particularly the U.S., remains globally leading and dominant. For Chinese enterprises, the significance of Western markets lies not only in their substantial market share but also in the fact that the channel for learning and drawing on their experience must remain open. Maintaining connections with Western markets is a key to sustaining innovation dynamism.

The complexity of China-U.S. relations has presented unprecedented challenges to Chinese enterprises in these markets. Currently, the U.S. has placed over 1,000 Chinese enterprises on various entity lists, a systematic blocking that Japanese enterprises never experienced in the past. From a geopolitical perspective, it is growing increasingly difficult for Chinese enterprises to enter Western economies, even if they gain a competitive edge, they may be restricted, dismantled or shut down for security reasons. In such an environment, Chinese enterprises, especially those in high-tech manufacturing, cannot expect to succeed in Western markets if they continue to rely on traditional going global. Therefore, Chinese enterprises must go beyond mere going global and adopt “think and act globally to navigate global changes”. Chinese enterprises need to reposition themselves and enter these markets as non-Chinese entities in order to reduce geopolitical risks and increase market acceptance.

Looking ahead, the major economic blocs around the world may increasingly act independently as trade disputes between the U.S. and Europe intensify. Corporate identity politics could thus rise to new prominence. To counter potential de-globalization, Chinese enterprises may need to complete in the EU as EU-based entities and in the U.S. as U.S.-based entities. This represents a necessary strategic adjustment for Chinese enterprises to compete and cooperate effectively globally in the new geopolitical order.

The second segment comprises economies with currently relatively friendly ties with China, mainly including Russia, Iran, North Korea, Cuba and Venezuela. In 2024, the total consumption of China, Russia, Iran, Cuba and Venezuela is approximately $12.65 trillion, accounting for 15.6% globally. Among them, China's consumption expenditure is $10.37 trillion (12.6% globally), Russia's is $1.48 trillion (1.8%), Iran's is $0.28 trillion (0.3%), Cuba's is $0.10 trillion (0.2%), and Venezuela's is $0.43 trillion (0.7%). This bloc offers a space where Chinese strengths can be fully unleashed, although the market size is relatively limited. In these countries, Chinese enterprises can more directly leverage their advantages and capture a larger market share. However, even in these friendly economies, Chinese companies must pursue global resource integration-cross talent, capital and innovation. 

The third segment consists of swing economies, including regions such as Southeast Asia, the Middle East, Latin America and Africa. In 2024, the total final consumption expenditure in these regions reached $20.89 trillion, accounting for 25.1% globally. Currently, the economies in these regions seek to balance between China and the U.S. and maintain a relatively neutral or even friendly stance toward Chinese enterprises. For instance, the ASEAN have been China’s largest trading partner for five consecutive years (2020–2024), while China has remained ASEAN’s largest trading partner for 16 consecutive years (2009–2024). China is also the largest trading partner of the Gulf Cooperation Council (GCC) and has held the position of Africa’s largest trading partner for 15 consecutive years. The strategic value lies not only in its market size and enormous future potential but also in its abundant resource endowment and strategic geographic location.

From their own national interests, these countries hope to seek a balance between China and the U.S. and benefit from both sides. While these regions currently maintain relatively friendly relations with China, the situation could shift significantly under the threats and inducements from the U.S. Panama’s recent withdrawal from the Belt and Road is a clear example. On February 2, 2025, following a visit to Panama by U.S. Secretary of State Marco Rubio, President Mulino announced at a press conference the termination of the memorandum of understanding on the Belt and Road with China. The UAE's G42 is another example. G42 originally had sound cooperation with Chinese firms, but under U.S. pressure, it was forced to make a choice. In April 2024, Microsoft invested $1.5 billion in G42, and in exchange, G42 pledged to cut ties with Chinese enterprises that had been placed on the U.S. Entity List and to sell its ByteDance stake.

At present, the Trump administration's strategic intent toward swing regions is clear: to turn a tripartite world into a bipolar world. It seeks to force these countries to side with the U.S. over China through threats and inducements. In these regions, even if Chinese enterprises achieve commercial success, the tide could quickly reverse when the U.S. exerts sufficient pressure. Businesses must carefully access geopolitical risks and develop contingency strategies for multiple scenarios. They should strive to consider adopting an appropriate positioning when engaging in these currently relatively independent third-tier markets, in order to leaving room to maneuver potential future geopolitical changes.

Think and Act Globally to Navigate Global Change

Today anti-globalization and de-globalization are on the rise, geopolitical frictions and conflicts are intensifying, and the global competitive landscape has undergone profound shifts. This requires us to move beyond merely going global and to approach and engage in global competition with “think and act globally to navigate global change”.

Going global and going out essentially reflects a China-centric view of the world. Externally, they represent an upward-looking viewpoint; internally, they represent a China-centered mindset. Amid intensifying de-globalization, this approach is no longer sufficient to address the challenges faced by Chinese enterprises in global expansion. Simultaneously, the global localization strategies Western enterprises are also not applicable to Chinese enterprises due to the geopolitical conflicts between China and the U.S.

“Think and act globally to navigate global change” signifies a fundamental shift in vision, perspective and mindset. It embodies a strategic approach that transcends national identity, requiring Chinese enterprises to adopt differentiated strategies across the three major market segments. By assuming the most appropriate roles to address global challenges, fulfilling global responsibilities, integrating into local communities and economies and benefiting local populations, they can gain accepted, trusted and even respected worldwide, thereby achieving sustainable global growth.