Stronger Exports and Trade Surplus as US Tariffs Threaten

China’s exports in December rose 10.7% year-on-year, surpassing economists’ expectations of a 7% increase. This surge comes as Chinese factories worked to fulfill orders before US President-elect Donald Trump’s potential tariffs take effect. The increase in exports was met with a modest 1% rise in imports, pushing China’s trade surplus to $104.84 billion.

Exports to the US saw a 15.6% jump in December, while shipments to the European Union and Southeast Asia grew by 8.8% and 19%, respectively. Analysts suggest that China’s export strength is partly due to businesses trying to front-run potential tariff hikes from the incoming US administration.

Rising Exports Amid Looming US Trade Measures

Trump has promised to impose higher tariffs on Chinese goods and address loopholes that currently allow Chinese exporters to sell products at lower prices in the US. If enacted, these tariffs would likely raise costs for American consumers and reduce profit margins for Chinese exporters. However, in the short term, China’s export growth remains robust, fueled by increased global market share, weak exchange rates, and the country’s ongoing push into higher-tech manufacturing.

Despite this, experts predict that China’s exports could slow later in the year if the new tariffs are implemented. In 2024, China’s total imports and exports reached a record 43.85 trillion yuan ($5.9 trillion), a 5% year-on-year increase. As the world’s largest exporter, China is working to expand its trade with Belt and Road Initiative countries, alongside its traditional markets like the US and Europe.