The One Bargaining Chip China Won't Surrender

As trade negotiations rattle on, you can bet the one area where China won’t budge is industrial policy. 

The “Made in China 2025” program, a subsidy-driven blueprint to turn the country into a global powerhouse of advanced technologies, has been a point of contention since the trade war began. The Trump administration, and other foreign critics, say government handouts distort the market and throw up hurdles to access. China’s sheer size – accounting for about a quarter of the world’s manufacturing – means that economies of scale lower costs, which makes factories from Detroit to Dresden less competitive.