What's Happening?
Goldman Sachs has developed an 'involution barometer' to assess the impact of China's anti-involution campaign on various industries. Tim Moe from Goldman Sachs anticipates that older economy sectors like solar and cement will benefit from these efforts, leading to improved profits in 2026. However, he warns that countries may resist if China attempts to export excess capacity, which could affect global market dynamics.
Why It's Important?
China's anti-involution campaign aims to address inefficiencies and promote sustainable growth within its economy. The anticipated profit increase for certain sectors highlights the potential benefits of these efforts. However, the possibility of international pushback against excess capacity exports could create tensions and impact global trade relations.
