[Salon] Look to the ‘rising’ Global South, ex-diplomat tells Chinese businesses

[Chas Freeman <cwfresidence@gmail.com>]

Look to the ‘rising’ Global South, ex-diplomat tells Chinese businesses

Amid tighter US and European markets, diversification and localisation can minimise risks, Le Yucheng tells annual forum

SCMP

Vanessa Caiin Shanghai

Published: 4:12pm, 8 Nov 2025

Chinese businesses should pivot their attention to the “rising” Global South such as Africa and the Middle East while minimising foreign investment risks through localisation, according to a former senior diplomat.

Le Yucheng, who was a Chinese foreign vice-minister from 2018 to 2022, offered the assessment on Wednesday at the Hongqiao International Economic Forum in Shanghai, held as part of the China International Import Expo (CIIE), one of the world’s largest trade fairs.

The annual six-day expo drew more than 4,000 companies from around the world, according to its organiser, the CIIE Bureau, a unit of the Ministry of Commerce.

At a session examining open trade and security-based development, Le argued that diversification and localisation were crucial for Chinese enterprises going overseas.

The retired diplomat said that in a world of diversified development, players should not put all their “eggs in one basket”, adding that one “shouldn’t focus only on the European and American markets”.

He described the Global South as “rising” and said markets in Asia, Africa and Latin America were “growing rapidly”.

The Global South and countries in Brics – an association of major emerging national economies – had made substantial contributions to the world’s economic growth, he said.

“These emerging markets have strong demand for China’s products, technology and supply-chain capabilities … We shouldn’t ignore regions like Africa and the Middle East,” he said, adding that such an approach “helps to mitigate risks”.

Facing a tighter domestic market, more Chinese companies have sought to operate outside their comfort zone and expand overseas in recent years.

Sino-US trade tensions have also prompted some Chinese businesses to look at markets beyond America, especially emerging economies.

China has more than 52 million small and medium-sized enterprises, according to official data.

By the end of 2024, 34,000 Chinese investors had established 52,000 overseas enterprises in 190 countries and regions, according to the ministry.

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A survey last year by the Hong Kong Trade Development Council showed that nearly 90 per cent of polled mainland China businesses indicated a plan to “go global” in the next three years, with more than 70 per cent voicing an interest in emerging markets.

Chinese carmakers, for example, have been pivoting towards Africa for new growth, particularly in the electric vehicle sector, motivated by fierce competition at home and higher tariffs in the American and European markets.

Meanwhile, China has built deep economic ties across the Middle East, investing in sectors such as infrastructure, energy, telecommunications, ports and logistics through its Belt and Road Initiative, Beijing’s plan to grow global trade.

The Middle East accounts for nearly half of China’s oil imports. Situated at the crossroads of Asia, Africa and Europe, the region is a vital transit corridor for China’s overland and maritime trade routes.

As Chinese companies move to emerging markets, business leaders and researchers have highlighted the importance of integrating into local economic systems.

On Wednesday, Le pointed to the need for localisation, saying “we shouldn’t always rely on ‘parachuting in’ from outside”.

“We need to truly cultivate a local presence,” he added. “Employ local talent, use local resources and comply with local laws and regulations.”

Le advised that “when you become a local company, you enjoy the benefits of being a local company and that ensures better security”.

Vanessa Cai

Vanessa Cai is a reporter for the China desk, based in Shanghai. Previously she worked for Caixin Global in Beijing and Shanghai-based news outlet Sixth Tone.