Chinese Solar Manufacturers Report Major Financial Losses

Essay by Eric Worrall

Has President Trump’s withdrawal of Biden era renewable subsidies killed the Chinese economy?

Chinese PV Industry Brief: Major solar manufacturers report steep full-year losses

JA Solar, TCL Zhonghuan, JinkoSolar, Trina Solar and Daqo each announced significant losses for full fiscal year 2025 amid continued price declines and overcapacity.

JANUARY 16, 2026 VINCENT SHAW

JA Solar forecast a full-year net loss attributable to shareholders of CNY 4.5–4.8 billion ($619–660 million) for 2025, … It attributed the loss mainly to supply-demand imbalance …

TCL Zhonghuan said it expects a 2025 net loss of CNY 8.2-9.6 billion ($1.13–1.32 billion), versus a CNY 9.818 billion loss a year earlier. …

JinkoSolar released a notice indicating it also expects a full-year loss for 2025, without providing a range.  …

Trina Solar likewise said it expects to remain in the red for 2025; …

Polysilicon producer Daqo New Energy said it anticipates another full-year loss in 2025 …

…

Read more: https://www.pv-magazine.com/2026/01/16/chinese-pv-industry-brief-major-solar-manufacturers-report-steep-full-year-losses/

2025 was a bad year for natural disasters in China.

China suffered $35B losses in natural disasters that killed 763 in 2025

Natural disasters affected nearly 67M people, displaced 3.6M nationwide, says Emergency Management Ministry

Berk Kutay Gokmen  |16.01.2026 – Update : 16.01.2026

China suffered direct economic losses of 241.6 billion yuan ($34.7 billion) from natural disasters in 2025, which also caused 763 deaths or missing persons, the Ministry of Emergency Management said on Friday.

…

Besides floods and geological disasters, the ministry noted that droughts, low-temperature freezing and snowstorms, sandstorms, forest and grassland fires, marine disasters, and biological disasters also occurred to varying degrees across the country.

Read more: https://www.aa.com.tr/en/asia-pacific/china-suffered-35b-losses-in-natural-disasters-that-killed-763-in-2025/3801192

But there are deeper issues with the Chinese economy – a lot of private Chinese companies appear to be borrowing unsustainable amounts of money to cover losses, in an apparent effort to maintain market share at any cost.

China debt overhang leads to rising share of ‘zombie’ firms

J. Scott Davis and Brendan Kelly
December 23, 2025

…

There is mounting evidence of “zombie lending” in China, banks rolling over bad loans to unprofitable firms and allowing the status quo to continue rather than recognize losses.

In many ways the current experience in China mirrors that of Japan in the 1980s and 1990s. Rapid growth in private sector debt—also fueled by domestic savings—was followed by the appearance of zombie lending. In Japan, that zombie lending led to the inefficient allocation of capital and decreased productivity, especially in sectors shielded from foreign competition.

…

There is a downside to the reduced risk that comes from domestically financed debt. Chinese capital controls mean savings are largely captive. Notably, Chinese authorities aggressively tightened capital outflow controls in 2016 when the country faced significant balance-of-payments stress.

Captive savings mean state-owned banks face little funding pressure. As loans come due, banks can easily roll over loans to unprofitable and otherwise insolvent companies to avoid recognizing loan losses on their balance sheets.

Such zombie lending was observed in Japan in the 1990s. Like China in the years after the Global Financial Crisis, Japan experienced massive growth in private sector credit in the 1980s.

…

Read more: https://www.dallasfed.org/research/economics/2025/1223

China appears to have a cultural problem with managing bad debts. While there are ongoing government attempts to strengthen bankruptcy processes, Chinese culture appears to encourage collaboration rather than adversarial style Western bankruptcies.

Excessive avoidance of bankruptcy procedures appears to be causing capital stagnation and heavy losses. Instead of forced selling assets of bankrupt companies, liberating their assets and workers for more profitable economic activities, insolvencies in some cases are allowed to linger far longer than would likely be tolerated in Western countries.

Of course it is difficult to obtain accurate information about the extent of such practices – parties involved in a bad debt coverups don’t exactly advertise what they are doing.

Did President Trump kill the Chinese economy by cancelling Biden era renewable subsidies?

My theory based on evidence like the quotes above is the Chinese economy was already sick before President Trump 2024. I believe a large chunk of the Chinese economy, likely including the EV and renewable sectors, is being propped up by banks rolling over and concealing bad debts. Even Chinese human rights abuses like allegations of widespread use of slave labor have failed to restore profits.

I believe Chinese banks are concealing massive capital losses, by enabling insolvent private companies to roll over unpaid debts, and allowing those companies to maintain a facade of solvency, while those insolvent businesses quietly haemorrhage cash on every sale.

There is an old saying, “If you owe the bank $100, you have a problem. If you owe the bank $1,000,000, the bank has a problem”. Having committed to propping up insolvent companies, the banks themselves are likely just as insolvent as the companies they are propping up.

Where is the cash coming from to continue this charade? The only plausible source of the money being used to prop up this large scale fraud is plundering the savings accounts of ordinary Chinese people.

So to answer my question, Trump did not kill the Chinese economy. The Chinese economy was already on Ponzi scheme life support well before Trump 2024. Even if every penny of Biden’s deceptively named Inflation Reduction Act had been poured into the hands of Chinese renewable manufacturers, the green subsidy money would have disappeared into the black hole of China’s still largely concealed debt and solvency crisis, without any noticeable impact on China’s economic problems.