Welcome back to China Insights Weekly. Here are some of the key takeaways from this week's edition:
YMTC is increasing its NAND market share to 13%, while the Chinese memory chip sector is accelerating.
Visa-free travel is boosting inbound tourism, with significant growth in Southeast Asia and the Middle East.
Fusion magnets are now fully domestically produced, bringing China closer to commercially viable clean energy.
Reusable rockets are gearing up for their second launch, driven by demand from satellite constellations.
Top News
ByteDance is launching Seedance 2.5, and Chinese Zhipu AI is closing the gap on the best American models at roughly one-fifth the cost (link)
ByteDance unveiled Seedance 2.5, its latest AI model for video creation, at a conference in Beijing. The model can generate 30-second clips in 4K from a single prompt, and now supports up to 50 reference elements, such as images, videos, or audio, compared to 12 for its predecessor. It will be launched in China next month, and there is no announced timeline for other markets. The new model is a significant improvement over its predecessor, and ByteDance continues to release some of the most advanced AI tools for video generation, competing with OpenAI's Sora and Google's Veo 3. The model offers greater creative control. The message is clear: the Chinese AI video sector is accelerating, and ByteDance is at the forefront.
Zhipu's GLM 5.2 has reached within one percentage point of Anthropic's Opus 4.8 on a key agent benchmark, at roughly one-fifth the cost., and token usage on OpenRouter is growing faster than after the launch of DeepSeek V4. GLM-5.2 is available under the MIT license and uses a new IndexShare architecture that improves the acceptable length of speculative decoding by 20%. It achieved a score of 62.1 on the SWE-bench Pro, surpassing GPT-5.5's score of 58.6. It is ranked second globally in the Code Arena leaderboard. The open-source model is free to download and fine-tune, putting pressure on closed-source labs developing state-of-the-art models. As the cost of tokens for frontier models strains budgets, companies are increasingly focused on the intelligence-to-price ratio, making Zhipu's model an attractive alternative. While the United States may have frontier models, China is winning the battle for enterprise deployment. The difference in cost is crucial.
Eli Lilly is once again partnering with Shanghai-based Abbisko in a $1.9 billion multi-target research and development agreement (link)
U.S. multinational pharmaceutical company Eli Lilly has expanded its partnership with Abbisko Therapeutics, committing up to $1.9 billion to allow the Chinese biotechnology firm to leverage its capabilities in early discovery and development across multiple targets selected by Lilly. The agreement builds on a previous collaboration from 2022 focused on a candidate for the cardiometabolic area. Abbisko, an oncology specialist based in Shanghai, also has preclinical programs focused on obesity and eczema. This move reflects recent deals by Bristol Myers Squibb and Pfizer, which are routing internal programs through Chinese partners to accelerate early development. Lilly will make an undisclosed upfront payment, with Abbisko eligible for milestone payments and royalties. This continues Lilly's aggressive pace of dealmaking, fueled by GLP-1 revenue. Just last month, Lilly closed deals to acquire three vaccine developers, one neuroscience startup, and license assets from several biotechnology firms. The message is clear: the speed of Chinese early research and development is becoming an integral part of the global pharmaceutical strategy. The deeper the ties, the faster the pipeline.
YMTC's NAND market share rises to 13%, while global competition intensifies (link)
Yangtze Memory Technologies, or YMTC, has increased its global market share in NAND flash memory from 8% to 13% in a year, becoming the fastest-growing player in the sector, according to Counterpoint Research. Samsung still leads with 29%, followed by SK Hynix with 18%, while YMTC is now in fourth place. Representatives of the Korean industry acknowledge that the pace of Chinese memory chip manufacturers has exceeded expectations and is directly threatening the market positions of the two Korean giants. YMTC has seen double-digit growth for three consecutive quarters, with revenue reaching $2.6 billion in the first quarter of 2026, a staggering year-over-year increase of 445%. The data suggests that China's ambitions in memory are no longer a distant threat; they are reshaping the global NAND landscape in real time. The window for Samsung and SK Hynix to react is closing. For YMTC, the trajectory is clear: catch up, and then overtake. The race for NAND supremacy is now a three-horse race. And the Chinese challenger is rapidly gaining ground.
The Xiaomi YU7 GT completed the first autonomous lap on the Nürburgring in the world in 10 minutes (link)
The Xiaomi YU7 GT electric SUV has become the first production-ready vehicle to complete a fully automated lap on the Nürburgring Nordschleife. It achieved a time of 10 minutes and 29.483 seconds, which is exactly 3 minutes and 7 seconds slower than the manual record for the SUV, which was previously set by the same model at 7:22.755. The vehicle has a power output of 1,003 horsepower, or 738 kW, accelerates from 0 to 100 km/h in 2.92 seconds, and reaches a top speed of 300 km/h. The range is 705 km according to the CLTC methodology, and it can be charged to 570 km in 15 minutes. The price starts at 389,900 yuan, which is equivalent to $57,596 USD. The autonomous lap sets a benchmark for production-ready autonomous software. As one of the engineers stated: "It's not about beating human drivers; it's about demonstrating that autonomous systems can handle the most challenging track in the world. The real race has just begun."
The Chinese supercomputer Lingsheng leads the world ranking with a performance of 2.19 EFLOPS (link)
At the ISC 2026 conference in Hamburg, the Chinese domestic supercomputer Lingsheng took the top spot in the TOP500 ranking with a sustained performance of 2.19 EFLOPS, ending a nine-year period since China last held the top position. The system is built entirely on domestic processors and components, demonstrating that Chinese-made chips can compete at the highest level of scientific computing. China stopped submitting data due to US export controls, but its publicly available scientific papers provide transparency. The TOP500 ranking, which has been running since 1993, evaluates machines based on their performance in the LINPACK benchmark. Lingsheng's return signals the effectiveness of China's domestic chip strategy and has implications for AI training, climate modeling, drug discovery, and materials science. China is back on top, running on domestic silicon.
Inbound tourism to China from 80 visa-free countries is growing by 50% (link)
Ctrip has released its annual report, the "China Inbound Tourism Development Annual Report 2026," which states that nearly 80 countries now have visa-free access to China, and the number of tourists from these visa-free countries is growing by 50%, which is significantly faster than the growth rate for countries that still require visas. Southeast Asia has become the most dynamic source market. The number of visitors from Thailand more than doubled year-on-year, while Malaysia moved from fifth to third place among the largest source markets for inbound tourism to China. The Middle East saw an increase in arrivals of more than 100%, and there is growing demand for customized services, cultural experiences, and facilities catering to Muslim visitors. The report highlights the dramatic improvement in the efficiency of converting flights into tourists, which has increased from 1.6 tourists per flight in 2019 to 12.1 by the end of 2025, with the recovery in demand significantly outpacing supply. Ctrip describes this as China's official entry into a "strategic window for a trillion-dollar market." The report also notes the broader recovery of China's tourism industry, with younger foreign travelers seeking authentic and in-depth experiences in smaller cities and less well-known destinations.
China Achieves Breakthrough in Superconducting Magnets for Nuclear Fusion (link)
China has completed the world's largest superconducting magnet for a fusion reactor, a toroidal coil 21 meters long and weighing 582 tons. It has also successfully tested a fully domestically produced high-temperature superconducting central solenoid coil under full operating conditions. Both components have 100% domestic supply chains, from materials to manufacturing, with key performance indicators exceeding international counterparts. The magnets are crucial for maintaining plasma heated to over 100 million degrees Celsius, bringing China closer to commercially viable fusion energy. The breakthrough was announced on June 27, 2026, after expert verification. For a country racing to secure clean energy, fusion is the ultimate prize. China is now one step closer. The technology is real. The supply chain is domestic. The implications are enormous. The era of fusion may be closer than we think, and China is leading in this race.
China's CGN Breaks Ground on World's Largest Concentrated Solar Power Plant (link)
China General Nuclear Power has commenced construction of the world's largest concentrated solar power plant in Qinghai province. The project includes a 3.7 million square meter solar collection area, three 1.1 million square meter tower fields, and a 400,000 square meter trough field, as well as a molten salt energy storage system exceeding 11.7 million kWh. Both are world records. The power plant will generate 1 billion kWh annually, save 320,000 tons of coal, and reduce CO2 emissions by 860,000 tons. China's concentrated solar power capacity is set to double to 1.8 million kW by 2025, with a target of 15 million kW by 2030. Construction costs have fallen by half over the past decade, to 15,000 yuan per kW, and the cost of electricity generation has decreased to approximately 8 US cents per kWh. This project represents a significant step towards Beijing's goal of carbon neutrality by 2060. The technology is proven. The world's largest concentrated solar power plant is another sign that China's clean energy transformation is rapidly accelerating.
The commercial space sector is poised for a second boom thanks to reusable rockets and the demand for constellations (link)
China's commercial space sector is on the cusp of a second wave of growth, driven by breakthroughs in reusable rocket technology and a rapidly increasing demand for satellite constellations. In July, Long March 10B will conduct the world's first sea-based capture of a 5-meter-long methane rocket using a net, while Zhuque-3 Y2 from LandSpace is set to demonstrate a vertical landing. The Qianfan constellation requires one to two launches per month; the GW project plans for 13,000 satellites, and G60 aims for 15,000. At the end of 2025, Beijing submitted 203,000 frequency applications to the International Telecommunication Union, a specialized agency of the United Nations, in a single week, which was the largest single submission in history. The government has elevated commercial space activities to a "strategic emerging industry," and the STAR market now offers an accelerated path to IPO. The sector is transitioning from concept to reality.
China's AI-powered laser mosquito zapper goes viral after successful crowdfunding (linkThe Chinese startup Photon Matrix Lab has raised over $2.7 million on Indiegogo for an AI-powered laser device that detects and kills mosquitoes in flight. The price ranges from $600 to $630 per unit, and the campaign attracted over 4,000 backers from more than 50 countries, exceeding its goal of $20,000 by a factor of 130. The device uses lidar, AI-powered computer vision, and laser systems to target objects as small as 2 mm in just 0.003 seconds, and can neutralize up to 30 insects per second. The detection accuracy exceeds 95% within a range of six meters. The product's viral success, fueled by a TikTok video that garnered over 70 million views, highlights China's ability to translate industrial and defense technologies into consumer markets. Mass production is planned for the summer of 2026, and the device could become the first practically usable consumer laser mosquito killer.
Tomáš Kučera & Yereth Jansen
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