Dragoman Digest

China bets big on humanoid robots as next tech frontier
Rising sector benefits from EV synergies but faces significant global competition
China is pursuing breakthroughs in the humanoid robot industry – machines designed with human-like form and movements – as a strategic priority for future economic growth. The robotics sector as a whole is experiencing considerable momentum domestically, with over 190,000 robotics-related companies registered in 2024 and an additional 44,000 already established in 2025. President Xi Jinping’s government has officially designated humanoid robots as “disruptive products”, with the Ministry of Industry and Information Technology setting ambitious targets for mass production this year. This initiative positions the sector as carrying transformative potential comparable to computers and smartphones.

China’s entry into this field is supported by its EV industry advances. The technological overlap between EVs and humanoid robots – approximately 70 percent of components are interchangeable – gives Chinese manufacturers a significant cost advantage through established supply chains. Unitree Robotics, one of China’s leading humanoid robot developers, offers models priced between US$13,600-$90,000. Meanwhile, Bank of America estimates Tesla’s Optimus model would cost between US$50,000-$60,000 without Chinese-made components, compared to only US$35,000 with them. Both Unitree and compatriot UBTech are scaling operations, with UBTech targeting production of 10,000 units by 2027. The market consolidation and fierce price wars that have characterised China’s EV sector in recent years could similarly accelerate humanoid robot innovation while driving down prices.

Despite China’s advantages, the US retains critical leads in AI chips, software, and algorithms. Chinese manufacturers remain dependent on technologies like Nvidia’s GPUs, which may be subject to even more stringent export controls. The humanoid robot sector overall remains in an embryonic stage of development. No clear industry leader has emerged, with experts describing the development of the sector as “a marathon, not a sprint”. Globally, the competitive landscape remains fluid – while Japan and Europe lead in industrial robotics expertise, they currently lag in humanoid development. These same players could leverage their technical foundations to close the gap as the global market expands toward a projected US$43 billion by 2035.
 

Vietnam launches aggressive administrative efficiency drive
Sweeping bureaucratic reforms aim to accelerate growth but face implementation challenges
Vietnam is implementing a dramatic bureaucratic overhaul under Communist Party General Secretary To Lam. The plan, announced in December 2024, will see Hanoi consolidate nearly half of its 63 provincial governments, eliminate an entire tier of district-level administration, and merge five ministries. This “streamlining revolution”, which makes the Trump Administration’s DOGE initiative look conventional, aims to expedite major projects by eliminating bureaucratic bottlenecks. For example, development projects routinely require 30-40 distinct agency sign-offs. Lam views administrative bloat as a critical obstacle to Vietnam becoming a high-income economy by 2045. Civil servants currently account for 7.9 percent of total employment – among the highest ratios in Southeast Asia.

The restructuring’s pace reflects political imperatives rather than methodical planning. Lam faces a narrowing window of opportunity before the Communist Party of Vietnam National Congress in January 2026, where there could, at least theoretically, be rotation in key leadership personnel – including the General Secretary, President, Prime Minister, and National Assembly Chair positions. Currently marginalised factions, previously weakened by anti-corruption campaigns, might regroup and regain influence. Further, currently high public support for the initiative may progressively erode. Already, over 22,000 civil servants have been dismissed, with 80,000 more scheduled for termination by August.

While the stated goal is to enable investment by cutting red tape, Vietnam watchers identify significant implementation risks. The private sector’s higher salaries (civil servants earn just US$91 monthly) and the considerable uncertainty caused by job cutting, may denude talent in government ranks. Merging power into newly formed “superministries” also risks empowering vested interests. By excising entire provinces, these administrative changes could also disrupt Vietnam’s carefully maintained regional power balance between northern, central, and southern representatives. Unlike China’s centralisation of authority, Vietnam has traditionally emphasised collective leadership across geographic regions.
 

Plummeting rice prices imperil Asian agriculture
Emphasis on self-sufficiency exacerbates challenges for rice exporters
Asian economies reliant on agriculture are increasingly struggling with India’s decision to lift export bans on certain types of rice. In September 2024, India rescinded a ban on certain types of rice exports which had been in place since July 2023 to combat food inflation. The effects of India’s re-entry into the global market have been most pronounced in Thailand and Vietnam, the world’s second and third largest rice exporters after India. Thai rice prices fell 31 percent year on year in April from US$599 to US$412 per tonne, the steepest monthly decline in over a decade. Vietnam’s prices fell to approximately US$400 per tonne, a 40 percent drop from late 2023 levels. At these depressed prices, farmers in both countries are struggling to turn a profit. In contrast, Indian farmers are shielded by New Delhi’s minimum support price and other forms of subsidies. In an attempt to stabilise prices, the Thai government is currently in discussions with India and Vietnam, whilst courting Japan as a potential export market.

These developments are occurring against a broader backdrop of concerns around global food security. Experts estimate that global rice output must increase by 15 to 20 percent to satisfy rising demand. However, climate volatility, materialising in intensifying rainfall and prolonged dry spells, is eroding yield reliability. Research indicates that for every one degree Celsius rise in global temperatures, rice yields will decrease by 3.2 percent. Instead of relying on market based price signals to incentivise adequate supply, countries are increasingly prioritising self-sufficiency. Indonesia has taken a particular protectionist stance, implementing a ban on rice imports as part of President Prabowo Subianto’s plan to achieve national food self-sufficiency by 2029. The Indonesian government has earmarked one million hectares in South Papua for rice cultivation. However, previous large-scale agriculture projects in the region have struggled due to poor soil conditions, drainage issues and acidification. Climate change, trade policies and shifting national strategies are compounding, causing considerable challenges to Asia’s food security. 
 

EV revolution has upended balance of power amongst China’s auto hubs
Joint Ventures between state owned automakers and foreign companies have been slow to adapt
The global automotive market is being reshaped by China’s dominance in EVs, creating growing challenges for legacy automakers across the EU, Japan and the US. EV sales in China are projected to rise 20 percent this year, reaching 12.5 million cars. In 2024, nearly 90 percent of these sales came from domestic automakers. Domestic Chinese brands are offering high-tech vehicles at aggressively low prices, pushing international rivals out of the world’s largest auto market and increasingly capturing overseas demand. In 2024, BYD posted US$100 billion in revenue, surpassing Tesla’s annual earnings for the first time. Meanwhile, automaking neophytes like smartphone maker Xiaomi have seemingly come from nowhere to release cheaper vehicles which outperform Western rivals’ offerings on key metrics.

China’s national EV success story belies the localised pockets of pain which exist across the country. Guangzhou, once China’s top car-producing city, saw production drop 20 percent last year to 2.5 million units. Guangzhou is grappling with the reality that Chinese consumers are favouring EVs and domestic brands. Guangzhou's auto sector is dominated by state-owned Guangzhou Automobile Group’s (GAC’s) JVs with Toyota and Honda - which are largely focused on international combustion engine vehicles. Guangzhou’s economy grew just 2.1 percent in 2024, making it the slowest among China’s 19 biggest cities. A similar story is playing out in Changchun, home to state-owned automaker FAW Group, which has joint ventures with Toyota and Volkswagen. Shenzhen, home to BYD, continues to boom. In 2024, EV output grew by over 65 percent to 2.9 million units, whilst the city registered economic growth of 5.8 percent.