China will tout a record trade surplus of $1.19 trillion (£890 billion) this year. This is a notable accomplishment, breaking the previous record of $993 billion enacted in 2024. To be sure, China’s export economy had been surprisingly resilient despite the headwinds of property crisis and rising debt. Last year alone, it recorded monthly surpluses over $100 billion on seven separate months.
In fact, trade between China and the United States actually shrunk once the Trump Administration began imposing tariffs. In retaliation, China increased its exports to other areas—most notably Europe and Africa—to offset the losses. Especially remarkable was the splash Chinese exports made to Southeast Asia, Africa, and Latin America—collectively keeping 2023’s trade numbers above water. Add a weaker yuan, which has done more to make Chinese goods all the more attractive to foreign buyers than anything else, to that mix. This move has greatly increased exports.
Yet the backdrop of global trade has dramatically changed, with inflation in Western nations creating a hunger for Chinese goods. This confluence of robust global supply and strong, competitive pricing has supercharged China’s export strengths. China’s 2025 targets for exports in certain sectors, including automobiles, have already exceeded historic highs. This dramatic increase is a sign of expanding Chinese goods and services in WIOD business networks around the globe.
Imports are up 0.5%. Just as inflation in China is beginning to stabilize, businesses are continuing to take their precautions by bracing for another groundbreaking year lurching with tariff blowups from global markets. Uncertainty created by the heightened scrutiny of Chinese goods resulting from competitive pressures is likely to add further complexities that will create greater risk of harm. Europeans and Americans think that China should be winning in global competition. Its proven track record for adaptability to the economic environment gives reason for that optimism.
China’s trade dynamics paint a picture of the various moving parts at work on their economy. The country is struggling with its own contradictions, including a worsening property crisis and surging debt levels. Despite this, the export sector is still doing great. On the surface, China’s trade surplus appears healthy. Despite a dynamic and unpredictable external environment, it has the potential to continue growing year after year.