China has stepped up its role as a global cleantech financier, directing roughly USD 80 billion into overseas clean energy and industrial projects over the past year. New analysis from Climate Energy Finance in Australia places China’s outbound green technology investments at more than USD 180 billion since early 2023, highlighting a rapid expansion driven by domestic industrial pressures and shifting geopolitical dynamics.

Outbound Capital as a Release Valve for Domestic Oversupply

Chinese solar, battery, and critical minerals producers continue to face a widening supply surplus at home. Analysts note that this imbalance is pushing companies to deploy capital abroad in order to absorb excess production and protect margins. Caroline Wang from Climate Energy Finance explained that a structural mismatch in China’s clean technology markets is reinforcing the need for global expansion. Overseas investments are allowing firms to relieve domestic pressure while cementing their influence across the emerging energy transition landscape. These ventures also strengthen China’s position in strategic supply chains. By embedding manufacturing, infrastructure, and technical standards in foreign markets, Chinese companies are shaping the pace and direction of decarbonisation globally.

Geopolitical Effects After New United States Tariffs

The acceleration in Chinese outward investment follows the introduction of new tariff measures by the United States under President Donald Trump. Rather than slowing cooperation, the report indicates that several countries have moved closer to China to secure affordable technology and maintain progress toward national climate goals. This shift has added complexity to Western conversations about supply chain diversification. China already dominates several upstream and midstream segments, including refining, module assembly, and battery processing. New outbound ventures deepen this influence by creating locked-in infrastructure and long-term demand for Chinese hardware.

Read more: Osmosis Unveils $80 Million Emerging Markets Fund Linking Growth Potential with Measurable Environmental Progress

Emerging Markets Become the Primary Destination

Three quarters of China’s low-carbon foreign direct investment since 2023 has gone to Asia, the Middle East, Africa, and Latin America, according to research from the Net Zero Industrial Policy Lab at Johns Hopkins University. These regions are absorbing both manufacturing investments and large-scale energy projects. Southeast Asia remains a central hub for electric vehicle, battery, and energy storage expansion. Solar manufacturing slowed due to trade restrictions in the West, but grid-scale renewable projects and EV-linked infrastructure continued to scale. The Middle East and North Africa region recorded some of the fastest growth, as governments pursue economic diversification and invest in next-generation industrial platforms. These partnerships often take the form of joint ventures that integrate mining, processing, component production, and installation within a single project ecosystem. Wang noted that these engagements offer a pathway for emerging economies to reduce fossil fuel dependency while building new industrial capabilities. She cautioned that the window to join advanced clean technology supply chains may narrow quickly as competition intensifies.

Mega-Projects Reveal China’s Integrated Supply Chain Strategy

Recent large commitments underscore China’s long-term approach. One of the most notable examples is an USD 8.28 billion green hydrogen project in Nigeria led by Longi Green Energy. In Indonesia, CATL is progressing with a USD 6 billion battery plant positioned to anchor an expanded regional EV industry. These projects illustrate a preference for integrated supply chain structures. By controlling upstream minerals, midstream refining, and downstream manufacturing, companies reduce volatility while establishing a dominant role in host markets. Governments gain rapid infrastructure but must navigate long-term dependencies on Chinese standards and technology.

Explore OneStop ESG Marketplace: Renewable Energy

Strategic Implications for Global Leaders

The central question for policymakers and investors is no longer whether China will continue driving overseas cleantech expansion. The question is how recipient countries and competing economies will respond. Nations that leverage inbound capital to build domestic capabilities and negotiate balanced industrial terms could secure long-term benefits. Others may risk becoming locked into externally controlled supply chain positions with limited strategic flexibility. China’s USD 180 billion outbound footprint reflects a shifting distribution of climate investment power. The next phase of the global energy transition is increasingly shaped in emerging markets where industrialisation, economic development, and decarbonisation converge. Cities such as Lagos, Jakarta, Riyadh, and Hanoi may now play as critical a role in cleantech leadership as Beijing, Brussels, or Washington.

Explore ESG Solutions on our marketplace - OneStop ESG Marketplace.

Keep abreast of the top ESG Events on OneStop ESG Events.

OneStop ESG Educate: Your go-to source for top ESG courses and training programs tailored to your needs.

Stay informed with the latest insights on OneStop ESG News.

Discover meaningful career opportunities on OneStop ESG Jobs.