Since US President Donald Trump took office, trade tensions between the US and China have escalated, although a recent easing of tariffs announced on April 23 suggests a more calibrated approach. Nevertheless, the overall competition between the two nations continues, with maritime issues becoming a significant area of focus.
In a bold escalation of its ongoing trade dispute with Washington, China has dramatically tightened its grip on the global supply of critical metals—imposing fresh export restrictions on rare earth elements and slashing shipments of gallium, germanium, and antimony, materials essential to technologies ranging from semiconductors to defense systems.
Taiwan is strengthening its asymmetric warfare capabilities through unmanned surface vessels (USVs), with both government and private sector companies developing technologies that could reshape the island's maritime defense posture.
The Belt and Road Initiative (BRI), once shadowed by international concerns over China's overseas expansion, is now entering phase 2.0 amid the intensifying US-China trade war and global supply chain restructuring. Chinese President Xi Jinping has recently made frequent visits to Southeast Asia, with his state visit to Malaysia opening doors for the Commercial Aircraft Corporation of China (COMAC) to enter the ASEAN market.
As global trade grapples with the turbulence of tariff disputes, defense and military demands remain undeterred, emerging as pivotal bargaining chips in negotiations over reciprocal tariffs with the US. Unmanned vehicles have surged to the forefront of strategic priorities, with Taiwan's drone industry already coalescing into a nascent national team.
China's drone supply chain operators report that open-source AI technologies like DeepSeek are significantly enhancing drone performance when applied to power systems and aerospace applications. This integration highlights both technological advances and growing cybersecurity challenges.
China has positioned the low-altitude economy as a cornerstone of its future industrial strategy, with drones serving as the linchpin of this burgeoning sector. Leveraging its early entry into the drone industry, China has secured a dominant global market share, accounting for 70% of commercial drone sales worldwide. This leadership stems from a combination of state-backed technological advancements and cost-effective manufacturing, enabling Chinese firms to outpace international competitors.
The Chinese companies complain about America's non-tariff barriers, but many foreign car manufacturers and brands want to enter the Chinese market—what company hasn't returned defeated?
China's low-altitude economy is developing at a rapid pace, with companies like Aerofugia and Lzlair advancing electric vertical takeoff and landing (eVTOL) technology toward commercial applications. Chinese firms are actively competing for certification, with expectations of widespread commercial deployment beginning in 2026.
The 3rd InnoEx show kicked off in Hong Kong on April 13, 2025, with the low-altitude economy taking center stage. Together with the concurrent 21st HKTDC Hong Kong Electronics Fair (Spring Edition), the exhibitions showcase more than 2,800 companies from 29 countries and regions.
Hong Kong is demonstrating its smart city innovations at InnoEX 2025, with a strong focus on robotic applications developed by various government departments.
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