China’s 2026 “Anti‑Involution” Campaign Has a Target List
Why Beijing moved first on food delivery, EU-bound EVs/batteries, and PV exports—andwhy energy storage could be next
This is the first fully paid article of my newsletter. I want to make it genuinely subscription-worthy: a structured read on Beijing’s latest “anti-involution” policy push. If you’re hesitating, email me, and I’ll send a PDF. Although the article is paywalled, I welcome anyone to quote from it, provided proper attribution is given.
Since the beginning of 2026, the Chinese government has rolled out a series of closely interconnected regulatory and industrial policies across food delivery platforms, power batteries, electric vehicle international trade, and photovoltaic product exports. These measures are, in essence, the implementation of the year’s core economic governance agenda: “deepening the rectification of ‘involutionary’ competition.”(深入整治‘内卷式’竞争”) Domestically, the aim is to repair market ecosystems distorted by destructive competition. The cancellation of PV export tax rebates and the EV sector policies represent a strategy of “treating internal ailments through external means”(借外治内)—the PV industry accelerates market clearing by eliminating disguised subsidies, while the EV sector uses price undertakings to secure profit margins, compelling domestic automakers to export higher-margin and higher-value-added models. At the same time, such policies help alleviate trading partners’ concerns about Chinese imports disrupting their domestic industries, thereby easing China’s diplomatic environment.
The key question is: why does the “anti-involution” campaign prioritize food delivery, EU-bound EVs and power batteries, and PV exports? Macro-level governance of involution through sector-by-sector targeting is impractical. The selection criteria, therefore, rest on identifying which industries have fully descended into “destructive competition,” where the damage spills over into the macroeconomic objectives of the 15th Five-Year Plan—real economy profits, employment and livelihood quality, fiscal resource efficiency, and external trade friction and positioning vis-à-vis international rules. Food delivery, EVs/batteries, and PV simultaneously satisfy conditions across all four dimensions: large market scale, long value chains, high sensitivity to price signals, and amenability to administrative adjustment.
