Industrial Subsidies Reach Post-Crisis High
Industrial subsidies across 15 major sectors have risen to their highest level relative to company revenues since the 2008–2009 global financial crisis, according to a new report from the Organisation for Economic Co-operation and Development (OECD).
The findings are based on the OECD’s Manufacturing Groups and Industrial Corporations (MAGIC) Database of Industrial Subsidies, which is now publicly available. The database provides a firm-level perspective on industrial support, offering fresh insights into how subsidies influence global trade and competition. It tracks subsidies received by 525 of the world’s largest industrial companies between 2005 and 2024, including government grants, tax incentives, and below-market financing across a range of sectors and regions.
The database and accompanying report are expected to inform discussions at the OECD Ministerial Council Meeting, which begins on 3 June 2026 under the theme “Getting Industrial Policies Right for Open Markets, Growth and Prosperity.”
According to the report, total subsidies across the 15 sectors reached USD 108 billion in 2024, equivalent to 1.3% of firms’ revenues. This represents the second-highest level on record relative to revenue, surpassed only by the 2009 peak, when a sharp decline in sales during the global financial crisis inflated the subsidy-to-revenue ratio.
Although subsidy levels increased across most regions, Chinese firms continued to receive significantly greater government support than their international competitors. Between 2005 and 2024, companies in China received, on average, three to eight times more support than firms operating in OECD economies, depending on the sector and region.
The report estimates that subsidies accounted for approximately 22% of global market share gains achieved by expanding firms over the past two decades. For Chinese companies, that figure rises to 60%. Despite helping firms capture larger market shares, however, subsidies showed little evidence of delivering substantial improvements in productivity or profitability.
“Large and persistent industrial subsidies can distort global markets, creating unfair competitive advantages and contributing to excess production capacity,” OECD Secretary-General Mathias Cormann said. “Reliable data is essential for understanding how subsidies are reshaping international markets. The OECD MAGIC database provides governments with a common evidence base, helping to support coordinated efforts to strengthen fairness, transparency and efficiency in the global trading system while preserving the benefits of open markets and rules-based trade.”
The report identifies renewable energy equipment, semiconductors and heavy industries among the most heavily subsidised sectors. Between 2005 and 2024, manufacturers of solar photovoltaic panels, semiconductors, aluminium, steel and ships received the highest levels of support relative to their revenues.
State-owned and state-backed enterprises also played a prominent role in the subsidy landscape. Companies with government ownership exceeding 25% received substantially more support than privately owned competitors, particularly through direct grants and below-market borrowing. The OECD notes that this trend is partly explained by the concentration of state-owned firms in capital-intensive industries that rely heavily on debt financing, especially in China.
The report further highlights the lack of transparency surrounding industrial subsidies as a major obstacle to understanding their true scale and impact. Unlike systems that rely primarily on government disclosures, the OECD MAGIC database measures subsidies actually received by firms. This firm-level methodology enables the tracking of support provided across countries and administrative levels—including city, provincial and state governments—and offers greater visibility into economies where public reporting remains limited.
According to the OECD, the database represents a significant step toward improving transparency and providing policymakers with a clearer picture of how industrial subsidies are shaping competition, investment and trade worldwide.
Source: OECD