# U.S. policy brief: allied sourcing is not automatically China-independent

**2022 evidence, evaluated September 23, 2026.**

## Measured finding

China-origin basic-price value added accounts for 3.20–9.68% of the nine selected gross-export bundles; the corresponding U.S.-origin shares are 2.01–3.73%. These are separate economy–industry results, not an average or a coalition total.

South Korea has the highest China-origin share in each of the three matched industries. Its electrical-equipment exports have the largest share in the sample, 9.68%, compared with 3.68% from the United States. Germany's machinery exports have the smallest China-origin share, 3.20%, compared with 2.45% from the United States.

These are basic-price VA shares, not direct-import shares, and not estimates of output lost in a disruption. Source: [OECD regular ICIO](https://www.oecd.org/en/data/datasets/inter-country-input-output-tables.html), retrieved through the [World Bank institutional archive](https://reproducibility.worldbank.org/catalog/511/study-description).

## Decision relevance

For a U.S. buyer or program selecting allied supply, use origin exposure as an initial tracing question. In this sample, South Korean electrical equipment and electronics are the first places to investigate if the screening criterion is China-origin value-added share. That is not a ranking of military importance, expected disruption loss or preferred suppliers.

Before crediting a particular allied source as independent redundancy, identify its relevant upstream plants and parts, map Chinese-origin inputs through intermediary suppliers, and verify qualified alternatives, inventories and switching times. Access permissions, contract capacity and delivery schedules must also match the U.S. requirement.

Support a substitution or capacity intervention only after those product-level checks establish the binding constraint. This study estimates neither the cost of replacing an input nor the return to a subsidy, tariff or stockpile; it does not justify blanket exclusion of any partner or industry.

## Strongest alternative explanation

A value-added share records the economic value attributable to an origin, not an input's indispensability. A cheap component can halt an expensive production line, while a larger commodity input can have readily qualified alternatives. Thus the country–industry with the smaller Chinese share is not necessarily more resilient.

Different industry mixes, prices and input intensities can explain cross-country differences within these broad categories. The regular tables also average across firms rather than identifying the supplier network of any particular plant. They cannot isolate semiconductors, batteries, machine tools or defense-qualified products from their larger industries.

## What must be established before action

- Trace the actual product, upstream plants and parts; industry averages cannot identify a program’s supplier network.

- Verify alternate-supplier qualification, capacity, switching time, inventories and sovereign permissions.

- Check present-day conditions before using the 2022 benchmark; do not infer a current trend from one year.

- Compare the cost and accepted delivery of alternatives before selecting subsidies, tariffs or stockpiles.

## Confidence and boundary

The computations are reproducible; basic-price VA, net taxes and unallocated source-account discrepancies remain separate. Source imbalances are explicitly disclosed, and numerical checks are not calibrated model uncertainty. This study produces no confidence interval, causal effect, unique coalition total or revised national-power rating. Independent AI computational verification is not human peer review.

[Full study and nine-cell table](REPORT.md) · [Full-precision data](results.csv) · [Methods](README.md)