Xi in Washington: Where China Has Gained Power Since 2015
On his first state visit since 2015, Xi Jinping encounters a shifted balance of power. China dominates key supply chains; the US retains dollar, technology and alliance advantages.
Xi in Washington: On 24 September, China's head of state was received at the White House for his first US state visit since 2015. It is not his first stay in the United States since then – in 2023 he attended the APEC summit in California – but it is the first visit with the protocol forms of a state visit since his trip to Barack Obama.
Since 2015, the relationship has changed profoundly. Economic interdependence has turned into strategic competition over semiconductors, raw materials, supply chains, tariffs and military influence. China has built strong industrial levers. The United States still holds the most important reserve currency, deep capital markets, a dense network of treaty partners and leading companies in central technology fields.
China's strongest lever lies in supply chains
China's gain in power is especially visible in rare earths, which are needed for electric motors, wind turbines, electronics, data centres and armaments. According to the International Energy Agency, around 60 percent of global production of magnetic rare earths came from China in 2024. Its share of refining stood at 91 percent, and of sintered permanent magnets at 94 percent.
The IEA also shows the trend behind these snapshots: demand for magnetic rare earths has doubled since 2015. China's share of sintered permanent magnets rose from roughly 50 percent in 2005 to 94 percent in 2024. Control over processing and magnet production is politically more significant than mere ownership of the raw material. It can influence delivery times, costs and availability in several key industries.
Other states are building new mines and factories. According to the IEA, however, expansion outside China remains uneven: far less capacity is being created in refining, metallisation and magnet manufacturing than in new mines. Export controls thus become a negotiating instrument, while diversification takes years.
Industrial breadth, not just cheap production
China has long ceased to be merely a workbench for simple consumer goods. The country produces machinery, batteries, solar modules, vehicles, electronics and increasingly high-quality industrial components. According to the latest World Bank data, manufacturing value added reached around 4.76 trillion dollars in 2025. That was just under 26 percent of China's economic output.
The figure measures value added at current prices and does not by itself prove a technological lead. But it shows the industrial scale and a dense supplier network that cannot be relocated at short notice.
At the same time, vulnerabilities are emerging. China's growth has slowed, the property sector is weighing on households and local finances, and the population is ageing. Export surpluses provoke political counter-reactions. New tariffs and investment controls can push Chinese companies out of markets, even if they do not immediately remove their cost advantage.
The dollar remains an American systemic advantage
The US dollar is still the central reserve currency. According to the IMF, its share of allocated global foreign exchange reserves was 57.13 percent in the first quarter of 2026, after 56.42 percent in the final quarter of 2025. The earlier formulation of a sustained 58 to 59 percent would therefore have been too high.
Here the definition matters: the COFER statistics cover foreign exchange reserves and exclude gold. In addition, the IMF changed its presentation in 2025 by distributing previously unallocated reserves across currencies. Long-term comparisons must take this methodology into account.
The dollar role gives Washington influence over payment flows and sanctions and enables a depth of financing that China does not match. Add to that strong positions in chip design, software, cloud infrastructure and production equipment for advanced semiconductors. US export controls can limit China's access to certain technologies, but at the same time push Beijing towards its own investments.
Alliances count as well. The United States can coordinate its strategy with treaty allies and technology partners such as Japan, South Korea and European states. China maintains far-reaching economic ties but has considerably fewer formal military allies.
Dependence remains on both sides
The paradox of the summit lies in the fact that both sides have become more powerful and at the same time remain dependent on each other. American companies need Chinese suppliers and market access. China needs Western technologies, capital and purchasing-power-rich sales markets. Full decoupling would be expensive and would hit third countries.
For Switzerland this is directly relevant. Pharmaceutical, machinery and precision companies sell in both markets and source preliminary products from global chains. Export controls, counter-sanctions or new tariffs can therefore directly affect contracts, financing and compliance.
At the welcoming ceremony, Xi advocated communication, cooperation and regular military dialogue to prevent crises. These are political declarations of intent. Whether they produce robust rules for trade, export controls and crisis communication can only be judged from the concrete results of the visit.
Since 2015, China has gained power above all where physical production and critical materials matter. The United States has asserted structural advantages in the financial system, in its alliance network and in parts of cutting-edge technology. The state visit therefore does not measure a clear winner. It shows how many levers of pressure both sides now hold – and how expensive a miscalculation has become.
