China’s new global playbook —from exporter to investor

This report is from this week’s CNBC’s The China Connection newsletter, which brings you insights and analysis on what’s driving the world’s second-largest economy. You can subscribe here.

China is moving from global exporter to investor, right into regions the U.S. is eyeing.

As U.S. President Donald Trump this year intensified U.S. influence on Venezuela, Iran and Greenland, one of the immediate concerns on the Chinese side was its local investments.

Speaking at Davos on Tuesday, Chinese Vice Premier He Lifeng urged global leaders to provide a fair and predictable environment for Chinese businesses operating overseas.

There are significant investments in factories and tech at stake. While China’s trade surplus ballooned to a record $1.2 trillion in 2025, Beijing’s deals and contracts with countries tied to the Belt and Road Initiative surged to new highs. Latin America, the Middle East and Africa are key regions for the initiative, widely seen as a channel for China to build global influence.

Looking ahead to 2026, the Financial Times’s FDI Intelligence survey predicted China will be the largest source of overseas direct investment in 2026, ahead of the United Arab Emirates and then India. The U.S. tied with Saudi Arabia for fourth place.

The composition of that investment is also shifting. More Chinese overseas investments are in tech and manufacturing, partly because tariffs are pushing Chinese electric car companies to localize production abroad.

Global businesses and leaders are also curious to see how China’s tech stacks up.

Over the past six months, Beijing-based autonomous delivery vehicle company Neolix has begun receiving global visitors, including logistics businesses and the French Ministry of Transportation, Will Zhao, executive president of Neolix, told me last week.

“2025 was the year we started to really make this kind of contact with global potential partners,” he said, noting those partners include consultants or lawyers who work with local authorities on autonomous vehicle regulation.

“A lot of countries are looking for our investment for manufacturing,” Zhao noted.

Neolix obtained an operating license in the UAE late last year and announced a strategic alliance with a Portuguese mobility company earlier this month. Zhao said the company plans to deploy more than 10,000 autonomous delivery vehicles outside China this year and enter three new countries, ideally in Europe.

But Chinese companies don’t necessarily have to look far for overseas expansion.

Trade within Asia is a “mega theme” for the year ahead, global investment firm KKR said in its 2026 macro outlook. “For us at KKR, this is a scalable, secular trend with real investment potential that spans logistics, manufacturing, consumer markets, and digital enablement.”

China has increased its market share not only through exports, KKR said, but by building local operations in countries such as Vietnam.

“One of the emerging benefits for the region involves the increasing frequency of countries transacting in renminbi, a trend that has gained momentum post-COVID,” the report said.

The trend picked up even before Trump’s latest round of global tariffs.

In 2024, 60% of Asian trade was already conducted within the region, with KKR predicting subsequent growth of 8% in the following few years. A major factor, the report said, is that more than 800 million millennials in the region are about to reach an age at which they will be spending more.

Underscoring the shift in global trade, Southeast Asia has become Beijing’s largest trading partner and helped propel China’s global exports to grow by 5.5% last year, despite a 20% drop in shipments to the U.S. due to the trade war.

U.S. logistics giant FedEx is also navigating what its CEO Raj Subramaniam calls “re-globalization,” according to his recent interview with the New York Times.

In the last six months, FedEx has opened facilities in Istanbul, Bangalore and Dublin, Subramaniam said. “We’ve done different moves around Intra-Asia. A new platform in Osaka.”

Such decisions don’t come lightly in a world rocked by U.S.-China tensions. Subramaniam is also chair of the U.S.-China Business Council, which meets regularly with Chinese policymakers.

The global trade shifts also have an impact within China.

In a presentation to reporters last week, Cui Shoujun, a professor at Renmin University of China’s School of International Studies, pointed out that companies are hiring more foreign relations graduates — who just 10 years ago would have mostly headed to government jobs.

If trade tensions are here to stay, Chinese companies are using human talent and factory expansion to adapt.

Jeff Mahon, Director of International Business and Geopolitical Advisory at StrategyCorp, discussed the recent reset in China-Canada relations – and why Canada has been put in a position to develop a more pragmatic approach with China.

Sam Radwan of Enhance International predicted a further 40% correction in China’s real estate market by 2030 and said it was a systemic issue.

Goldman Sachs’ Hui Shan said that while China has made progress diversifying exports, shifting its economy from property and infrastructure toward consumption and services requires bolder policy action.

China markets rose Wednesday against a subdued regional backdrop as investors monitored geopolitical tensions following fresh tariffs from U.S. President Donald Trump tied to Greenland.

Hong Kong’s Hang Seng Index rose over 0.3%, putting its year-to-date gains at 3.7%.

Mainland’s China CSI 300 closed nearly flat, up 0.09%, and is 2.01% higher for the year. 

Jan. 19-22: Chinese Vice Premier He Lifeng to visit Switzerland and attend the World Economic Forum at Davos

Jan. 27: Industrial profits for December