Background: 2025 Sustainable Global Leaders Conference & First Green Industry and Sustainable Consumption Expo The 2025 Sustainable Global Leaders Conference took place from October 16 to 18 in Shanghai's Huangpu District Expo Park. Jointly hosted by the World Green Design Organization (WGDO) and SINA Corp, with collaboration from the IFRS Foundation's Beijing office, the event focused on "Facing Challenges Together: Global Action, Innovation, and Sustainable Growth." It aimed to harness global wisdom and explore new paths for sustainable development, injecting robust "Chinese energy" into global sustainable governance.
This edition of the sustainable conference has further upgraded from the previous four editions of the "ESG Global Leaders Conference." With an impressive lineup, approximately 500 prominent guests, including around 100 international attendees, were invited. These guests included political figures, representatives from international organizations, Nobel laureates, Turing Award winners, and leaders from Fortune Global 500 companies.
Su Yue, Chief Economist of Economist Intelligence China, attended the themed meeting "Building a Smart, Green, and Responsible Supply Chain Ecosystem" and participated in discussions.
In her address on constructing a smart, green, and reliable supply chain, Su Yue pointed out the significant global disparities in this field. Using the U.S. as an example, she noted that its policies might lead to a "green regression," as they are fundamentally based on traditional energy sources. However, she stated that the effects of geopolitical events are complex and not entirely negative. Citing the Russia-Ukraine conflict, she highlighted that the conflict has accelerated Europe's green transition process, creating new markets and cooperative opportunities for green product exports from countries like China. Su Yue concluded that geopolitical conflicts cannot be uniformly classified as negative; instead, new cooperation opportunities may emerge from them.
The following is the full text of the dialogue:
Niu Zhijing (Host): Today, we are discussing "Smart, Green, and Responsible Supply Chain Ecosystems," which is a common vision for many enterprises. However, in the current complex global environment, we recognize that our challenges are not just local but global. What do you think the challenges are? Is it technological barriers, cost pressure, inconsistent standards, or the impact of geopolitics?
Su Yue: Thank you for the question, Mr. Niu. I completely agree with the insights shared by the previous speakers. We have been tracking trade conflicts since April. The rise of unilateral trade protectionism in the U.S. has led to differentiated impacts on global prices. For China, this has increased some costs and put pressure on profits for enterprises. China's prices remain relatively low; if green investments increase, it indeed raises fixed investment costs for firms. However, from the perspective of Europe and the U.S., tariffs have added burdens to local consumers. While producers or retailers may absorb the tariffs initially, ultimately, consumers will bear the cost, potentially leading to significant inflationary pressures. Geopolitical factors greatly obstruct the green transition of supply chains.
Niu Zhijing: You just mentioned the influence of geopolitics; let's delve deeper into that. Over the past week, many intense changes have occurred. From a macro perspective, what larger consensus have you observed among major global economies regarding supply chain policies? What factors are driving today's discussion, and what hinders progress?
Su Yue: Thank you for the question. Since the first round of U.S.-China trade conflicts in 2018, we have observed globalization potentially moving in a reverse direction. However, after experiencing the COVID-19 pandemic, we see that the connectivity of global supply chains cannot regress. Although many initially questioned globalization, it is evolving in a new form. As mentioned by DHL's Ai Ruoxin, we see regional supply chains and the restructuring and extension of the entire supply chain, which deepen connections between nations.
You asked whether there is more policy consistency or divergence currently. I perceive that, despite many conflicts, we observe "high policy consistency"—that is, the rise of protectionism, which may not be welcome news. As mentioned by Gao Jinyu, in addition to tariffs as trade barriers, there are also non-tariff barriers related to standards, which may not necessarily be classified as barriers. For example, when the U.S. imposed tariffs on China, many Chinese goods shifted exports to Europe. However, during that time, Europe considered imposing an extra charge of 1 euro per package for Chinese products. When we talked to the European Commission, they clarified that this was not equivalent to a new tariff. The reason was that there are inconsistencies in Chinese product standards, leading to insufficient customs manpower to handle the influx of goods. The additional euro was meant to ensure regulatory efficiency and maintain consumer confidence to continue purchasing those goods.
We observe many conflicts, yet connectivity among nations remains strong, and I believe the pursuit of consistent standards is also increasing.
Secondly, regarding green, smart, and reliable supply chains, there are indeed substantial global disparities. For instance, in the U.S., Trump's policies may lead to a regression in the green transition due to his reliance on traditional energy. However, post the Russia-Ukraine conflict, Europe's green transition is accelerating due in part to China exporting numerous green products. We see that geopolitical conflicts cannot be simplistically viewed as entirely negative; they can also foster new cooperation opportunities. This is my observation.
Niu Zhijing: Let's conclude our first round of discussions here. Now, moving onto the second round, looking towards the future, the past few years have brought significant changes. From a macro view, I'd like to ask Su, you excel in macro forecasting, and the Economist’s covers are often memorable for their ingenuity. The Economist Intelligence is also renowned for risk forecasting. What are your views on the core risks that could impact the construction of global green and smart supply chains in the coming years? What are the key topics in your roadmap?
Su Yue: Thank you for your question. After categorizing the risks, we identified several major areas:
Firstly, not all risks are directly associated with human activity but do have some correlation. For example, extreme weather events like El Niño can lead to power outages in high-temperature regions, halting supply chains and production altogether. Extreme weather, in our view, is the greatest risk, particularly as many developing countries lack resilience to climate change.
Secondly, the current trade conflicts may lead to local economic recessions or a global economic slowdown, imposing significant cost pressures on governments and enterprises. Thus, whether there is sufficient funding to invest in green sustainable development is another critical issue. Many developing countries require support from multilateral institutions or major economies. We see China's numerous sustainable investments in Africa responding to this demand.
Thirdly, major global geopolitical conflicts. After the Russia-Ukraine conflict, Russia’s oil must find buyers, leading to imports from Africa, Vietnam, India, etc. From a market perspective, this is sustainable behavior, but the sale of traditional fossil fuels at discounted prices due to exclusion from China’s market creates friction in the cohesive actions needed for global sustainability transitions. This reflects the influence of geopolitical conflicts.
Additionally, the increase in energy demands or challenges brought about by human technological development deserves attention. For example, the rapid advancement of artificial intelligence (AI) is noteworthy. Interestingly, while the U.S. is a leader in numerous technology sectors, its electrification process lags behind China and Europe. The sharp rise in energy demand due to advanced AI is focused on whether green energy can meet this demand; this is another key area of inquiry.
Niu Zhijing: You mentioned AI's dual impact on society, promoting progress and efficiency while also placing pressure on energy. If we delve further, how do you view AI's overall impact on the supply chain ecosystem? Do you have specific evaluations?
Su Yue: From a purely technological standpoint, AI is definitely a positive factor, as it enhances efficiency. However, the Economist Intelligence does not only observe technology itself but also its societal impacts—whether AI benefits every individual in society is a crucial issue. Recent policies concerning China’s AI industry released by the State Council particularly emphasize AI's effect on the job market. Many academic studies indicate that AI primarily replaces jobs of less experienced graduates.
Technologically, AI indeed has a positive role in societal progress; however, the government must ensure that AI benefits all individuals to some extent, rather than allowing certain groups to suffer losses in the development of AI.
Furthermore, when we consider potential black swan events, is there an overheating of AI investments? Is there a risk of over-investment leading to a new bubble bursting? This is another important topic worthy of focus.
Niu Zhijing: The domain of intelligence is transforming, but change requires standards.
Su Yue: I believe that in the areas of "smart, green, and responsible," we have made varying degrees of progress. In terms of green, while technology has been achieved, standard adoption is the primary challenge. Regarding intelligence, due to pressures arising from advancements in AI technology and the rise of protectionism, I think there are more advancements worth anticipating.
Such domains require greater intergovernmental collaboration. If I had to summarize with one word, I would say "resilience." From observations in the past decade, globalization is an irreversible trend that will return in an even stronger form.