New growth in Asia—why China might be worth a closer look

The global economy is undergoing significant change. While Europe and North America face structural challenges, Asia continues to grow in importance. Over the past few decades, China has evolved from an export-driven manufacturing base into an innovation hub. This transformation raises key questions for investors: Where is new growth emerging, and what risks should be considered?

Asia on the rise: China as driving force

Emerging Asian economies, led by China, are shifting the global balance of power. According to our experts, Asia has already surpassed the Eurozone in terms of global gross domestic product (GDP) and is approaching the level of the United States. The International Monetary Fund forecasts that the region’s economic output could rise to around USD 38 trillion by 2030—nearly double the level of a decade ago.

Asia is therefore no longer merely a growth region. It is increasingly evolving into a structural disruptor of the global economic order, with China as a central driving force.

From production site to innovation hub

China has fundamentally redefined its economic role, transitioning from a production site to an innovation hub. Once known as the “workbench of the world”, China has transitioned from a production site to an independent innovation hub.

How is China successfully increasing its value creation within Asia?

Government measures promote economic independence, technological leadership, and the development of its own value chains. External factors, such as U.S. restrictions on key technologies, including semiconductors and artificial intelligence (AI), have further accelerated this change. At the same time, the domestic market is growing in importance. Domestic transactions boost the economy and create new opportunities for local companies.

Pragmatic innovation in the age of AI

Scheduled for adoption in March 2026, the 15th Five-Year Plan aims to reinforce the transition from an export-oriented manufacturing base to an innovation-driven economy. The plan emphasizes technological independence, strategic investments in research and development, and the advancement of key industries.

This approach is especially visible in the field of artificial intelligence (AI). While the U.S. emphasizes technological breakthroughs and experimental AI models, China prioritizes rapidly implementing and broadly scaling existing technologies. Centralized data availability, state-coordinated regulation, and large-scale implementation facilitate the application of AI in business and everyday life.

Geopolitically driven restrictions, such as constraints on advanced chip supplies, have further sharpened the focus on efficiency and application-oriented innovation. As a result, an AI ecosystem is emerging that prioritizes economic integration and widespread use over technological excellence. This model is increasingly shaping how AI is applied globally. China’s pragmatic approach to innovation and rapid scaling is not limited to individual sectors. New growth areas are emerging along the entire value chain, supporting the country’s long-term technological development.

Chinese tech sector: New perspectives beyond traditional markets

China’s shift toward an innovation-driven economic model could unlock long-term growth potential. Government support, a dynamic domestic market, and increasing autonomy from global supply chains foster a favorable environment for innovative companies. However, these opportunities are accompanied by challenges. Geopolitical tensions, regulatory uncertainty, and reliance on government support could influence both the pace and direction of the transformation. Therefore, careful consideration of these factors is therefore essential when assessing the landscape.

Have we captured your interest? Our experts are available for a non-binding discussion and are happy to share their insights.

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