New wave of Chinese globalisation favours physical presence over exports

Chinese companies are embarking on a new phase of global expansion, shifting away from earlier strategies focused on low-cost exports or high-profile overseas acquisitions and instead prioritising physical presence, brand building and deeper integration into local markets.

The latest wave, which gathered momentum after the COVID-19 pandemic, reflects changing economic realities at home. Slowing growth and intense price competition in China have made overseas operations increasingly attractive, prompting companies to refine how they operate abroad.

Chinese globalisation has unfolded in several stages. In the 1990s and early 2000s, manufacturers such as Haier and Huawei concentrated on exporting inexpensive goods, though they often faced perceptions of poor quality.

In the mid-2010s, large conglomerates spent billions of dollars acquiring foreign hotels, banks and other assets, deals that largely faltered due to heavy debt burdens and regulatory resistance in Western markets. During the same period, state-owned enterprises expanded overseas through infrastructure projects linked to the Belt and Road Initiative.

The current expansion differs markedly. Companies are moving beyond online sales and exports to invest in factories, retail outlets and logistics networks overseas. Lifestyle retailer Miniso operates more than 3,300 outlets outside China, while smartphone maker Xiaomi has said it aims to reach 10,000 overseas stores within five years.

Hiring practices have also changed. Rather than relying mainly on Chinese staff sent abroad, companies are increasingly recruiting local employees for sales, management and public relations roles to better navigate cultural and regulatory environments.

Innovation has become another defining feature of the new approach. Firms such as ByteDance and fast-fashion retailer Shein have shown that Chinese companies can develop global products rather than replicate Western models. In the electric vehicle sector, Chinese manufacturers such as BYD have drawn attention from foreign competitors, with some Western automakers exploring ways to learn from China's advances in EV technology.

Despite these shifts, overseas expansion remains challenging. Heightened geopolitical tensions have increased scrutiny of Chinese firms, particularly in sensitive sectors such as technology. Some companies have responded by creating separate corporate structures or independent technology platforms to reduce the risk of forced divestments or bans.

At home, Chinese authorities have also tightened oversight. Beijing has expressed concern about companies relocating headquarters to overseas financial hubs or keeping profits offshore, while remaining cautious about technology transfers. At the same time, officials have shown greater support for the international growth of consumer brands, viewing their success as a reflection of China's rising cultural influence.

Together, these trends suggest Chinese firms are moving beyond their traditional role as low-cost manufacturers and are positioning themselves as long-term global players, combining local hiring, physical expansion and technological development to compete in an increasingly complex international environment.