World Press Review
This international economic news digest examines the strengthening position of Chinese manufacturers in the artificial intelligence chip market, as well as trends in rising fiscal deficits and public debt burdens in advanced economies.
World Press Review
Politico reports that German Chancellor Friedrich Merz, Italian Prime Minister Giorgia Meloni, and Belgian Prime Minister Bart De Wever have urged steps to make business procedures simpler and cut regulatory burdens.
Specifically, Germany, Italy, and Belgium want a mechanism that would let them step into the European Parliament’s legislative process and, when needed, pause initiatives that could place excessive burdens on governments and businesses.
The EU leaders say such a mechanism would help bolster the European Union’s weakening economic competitiveness.
The letter also says the EU should seek to stop excessive regulation from causing the “irreversible loss of European industrial capacity and a further weakening of investment and competitiveness.”
The leaders called for a major speeding up of planning and approval procedures, along with the temporary suspension of some regulations under a proposed new “priority rule.”
According to International Data Corporation (IDC), Nvidia’s shipments of artificial intelligence accelerators to China dropped by 44% to 678,000 units in the first half of 2026. The US company’s market share was 34%. The decline was driven by US export restrictions and the growing use of domestically made alternatives in China.
IDC estimates that 9 out of 11 Chinese companies increased shipments compared with the same period a year earlier. Huawei more than doubled its shipments to 572,000 units, taking 28% of the market. Among other manufacturers, T-Head (Alibaba) accounted for 7%, Cambricon for 5%, Kunlunxin (Baidu) for 4%, and Hygon for 3%.
Total shipments of AI accelerators in China reached 2.008 million units. Shipments of graphics processing units (GPUs) fell by 26% to 991,000 units, while shipments of specialized non-GPU accelerators rose by nearly 80% to 1.016 million units, overtaking GPU shipments for the first time.
Four Chinese companies — Huawei, T-Head, Kunlunxin, and Cambricon — made up 95% of the non-GPU segment. The main buyers of these products are government institutions, internet companies, and telecommunications operators. IDC says competition is increasingly moving away from the performance of individual processors and toward the efficiency of computing clusters.
According to China’s customs authorities, exports of hybrid vehicles to the European Union tripled in the first half of 2026, rising from $2.5 billion to $7.5 billion. Compared with 2021, when exports were $845 million, their value increased ninefold.
After the EU introduced additional tariffs on Chinese electric vehicles in 2024, Chinese automakers shifted their attention to hybrid vehicles, which were not covered by those tariffs.
According to Jefferies, SAIC, BYD, and Chery account for more than 90% of Chinese hybrid vehicle exports to the EU.
Schmidt Automotive Research says Chinese brands captured 15% of the European electric vehicle market for the first time in the second quarter of 2026. Their share of the plug-in hybrid segment rose to 25%.
On October 9, China and the EU agreed to limit exports of Chinese hybrid vehicles. According to Car Industry Analysis, the new terms could make things more difficult for Chinese manufacturers, but are unlikely to stop their expansion in the European market.
In response, Chinese companies are weighing local production inside the EU. In particular, Changan plans to start manufacturing vehicles in the region in 2027.
According to the International Monetary Fund (IMF), net government borrowing in advanced economies is expected to reach 5.2% of GDP in 2026. That would be the highest level since 2021, when government spending rose sharply in response to the COVID-19 pandemic.
The IMF projects that the biggest fiscal deficits will be in the United States and China. In both countries, deficits could reach or exceed about 8% of GDP. Rising fiscal deficits are being accompanied by higher public debt servicing costs and a growing need for additional borrowing.
According to IMF estimates, global public debt, which was about 94% of global GDP in 2025, could reach 100% of GDP by 2029. That would bring the ratio close to its highest levels since the end of World War II.
The IMF warns that rising public debt burdens and borrowing needs are limiting governments’ ability to fund extra spending and respond to economic crises. To protect the sustainability of public finances, the Fund recommends a gradual and sustained process of fiscal consolidation.