China is taking control of a bigger portion of the world’s supply chains, causing a shift throughout China’s vast manufacturing sector and consequently in the global trade patterns by buying more than 70% of row materials and components from local suppliers and less from abroad. Those supply flows made China one of the top export destinations for years. The push to use local inputs for manufacturing is spreading to higher-tech items and contributing to slower global trade growth. Now exports to China, which have risen nearly every year since the 1990s, fell 14% last year, representing the largest annual drop. According to Chinese trade data, the proportion of foreign-made inputs in Chinese exports has been shrinking by an average of 1.6 percentage points a year over the past decade, and last year fell to 19%, from more than 40% in the mid-1990s. To build domestic capabilities, the Chinese government last year announced a plan to raise the domestic content of core components and key materials to 40% by 2020 and 70% by 2025. Indeed, according to national media reports, the country has been spending large amounts on research and development: $213 billion last year, or 2.1% of gross domestic product. As a result, biotechnology, aerospace and other high-tech-related exports to China fell 5% this year through September, while in specialty or higher-end chemicals the amount China’s imports from the U.S. fell 8% in the first seven months of this year. The gLAWcal Team LIBEAC project Monday, 31 October 2016 (Source: The Wall Street Journal)