China’s dominance in the global cleantech market was set to wane amid overcapacity, a weak domestic economy, slow global demand and export barriers, according to S&P Global.
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China’s share of solar photovoltaic (PV) module manufacturing would decline to 65 per cent in 2030 from 70 per cent last year, while its share of battery-cell manufacturing would drop to 61 per cent from 80 per cent last year, the rating company said in a report on Thursday.
“As we look towards 2025, manufacturing growth in China is expected to slow down in response to current overcapacity issues, leading to a more diversified cleantech manufacturing footprint by 2030,” S&P said.
The country’s weakening domestic economy, slowing international demand and trade curbs from the US and Europe were likely to further eat into China’s dominance in the global cleantech supply chain, it said.
Excess supply of cleantech equipment from China, especially PV modules, wind turbines and batteries, has led to a surge in global renewable energy installation, but has also eroded prices substantially in the past two years.
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Beijing and the country’s industry alliances have tried to rein in the overcapacity and price competition in cleantech manufacturing, but the effectiveness of their actions and the outlook remain unclear.