<h1>Export dependence threatens rebalancing; trade talks focus on curbing industrial overcapacity and boosting domestic consumption.</h1> China's export dependence and large global manufacturing share are focal points for trade talks, targeting reductions in subsidised overcapacity in sectors like steel and electric vehicles and policies to raise household consumption. Short-term measures such as rebates contrast with calls for structural reforms-expanded welfare, pension and health systems, and altered local incentive structures-to boost domestic demand. Rapid expansion in high-tech and green industries risks creating new overcapacity, and central coordination is urged to prevent provincial duplication and market distortions.