CATL and SMIC are two giant Chinese companies that are often singled out by Western think tanks as two firms who benefit from China’s subsidies, at the expense of foreign competition.

But all industrialized countries employ government subsidies, which help favored domestic industries grow. China, however, uniquely can invest in preferred sectors by channeling its massive trading surpluses, and providing low-cost access to its world-leading supply chains and logistics systems.

In contrast, North American and European companies who seek government incentives and subsidies are competing with other spending priorities, as all the funds come from taxpayers. This reality requires of companies seeking government help to do so through proxies, lobbying efforts, and through think-tanks who create research that can be published and used by lawmakers to justify the use of taxpayer funds.

China’s enormous subsidies come from trading profits. US and European subsidies come from taxpayers