Summary of Key Points
In the past decade, China's green trade has more than doubled in scale, making it the world's second-largest trader of green products. The structure of its exports has shifted from intermediates to end-consumer goods such as new energy vehicles and lithium batteries, with market focus moving towards Europe and emerging markets (Southeast Asia, North Africa). At the policy level, domestic legislation and specialized documents have promoted the development of a green trade system, while international regulations (such as the EU's carbon tariffs) have driven industrial upgrading. The global green market holds great potential for growth in the future, but China must address challenges such as green trade barriers and vulnerabilities in the supply chain of key minerals.
I. Green Trade Has Doubled in Scale, with China Becoming the Second-Largest Player
China's green trade volume increased from $212 billion in 2016 to $484.6 billion in 2025, a growth of 128.6%, accounting for 13.8% of the global total, second only to the EU. Export performance is particularly impressive: the value of green products exported rose from $126.6 billion to $390.2 billion, accounting for 22.4% of global green exports, meaning that one in every five global green products exported comes from China. The proportion of green exports in China's total exports has also increased from 6% to 10.3%, indicating that green products have become a new pillar of its foreign trade.
On the import side, there has been a shift: imports peaked in 2021 and then declined, with the value dropping to $94.4 billion in 2025 (a mere 10.6% increase from 2016), accounting for only 3.7% of total imports. This reflects China's growing capacity to produce green products domestically and its reduced reliance on imports.
II. Significant Changes in Export Products and Markets: Lithium Batteries Take the Lead, Emerging Markets Rise
- Product Structure: In 2016, the top export was "photosensitive semiconductor devices," but by 2025, lithium batteries had overtaken them (with exports worth $76.7 billion, accounting for nearly one-fifth of green exports). Photovoltaic cells and pure electric vehicles also remained in the top three. The shift from exporting intermediates like photovoltaic components to end-consumer goods such as new energy vehicles indicates that China's green industry has upgraded from assembly to manufacturing complete products.
- Market Structure: Europe remains the largest market for Chinese green trade (31.6% in 2025), with Southeast Asia (13.9%) and North Africa (26% growth rate in the past three years) becoming new growth areas. Although the United States is still the top export destination, its share has dropped from 16.6% to 10%. Germany surpassed South Korea as the second-largest market in 2024, with its share rising from 3.6% to 6.3%. The expansion of emerging markets shows that Chinese green products are becoming increasingly popular in developing countries.
III. Dual Drivers of Change: Domestic Legislation and International Regulations
- International Regulations: The EU's Carbon Border Adjustment Mechanism (CBAM) requires importers to calculate the carbon footprint of their products and pay a carbon tax, as well as conduct ESG (Environmental, Social, and Governance) supply chain audits. These regulations raise the entry barriers for Chinese companies.
- Domestic Policies: The new Foreign Trade Law, implemented in 2026, incorporates green trade principles into the legal framework, explicitly encouraging the import and export of green products and the establishment of standard systems. The Ministry of Commerce issued guidelines for expanding green trade last year, and the Ministry of Industry and Information Technology plans to increase the value of green factories to 40% by 2030, with the goal of developing zero-carbon factories. Companies are also taking action, such as using recycled marine fishing nets to make eco-friendly swimwear, which is well-received by overseas customers.
IV. Future Prospects: Great Opportunities but Many Challenges
- Opportunities: The global market for green products is expected to grow fivefold by 2030, with the market value of electric vehicles and solar energy reaching $2.1 trillion—five times the current level. The conflict between the United States and Iran has increased international interest in renewable energy, potentially leading to higher demand for Chinese green products like photovoltaic and lithium batteries.
- Challenges: Green trade barriers are becoming more stringent, and there are risks related to the supply chain of key minerals (such as lithium and cobalt).
- Recommendations: The report suggests focusing on green technology innovation (e.g., more efficient batteries), improving green trade standards in line with international norms, expanding into emerging markets to diversify risks, and establishing support systems (e.g., carbon footprint accounting services).
In summary, China's green trade has moved from a follower to a competitive player. By overcoming barriers and continuing to innovate, it can secure a more significant position in the global green market.