China’s trade surplus surges 20% to a record $1.2 trillion, even with Trump’s tariffs

China’s trade surplus soared to a record high of nearly $1.2 trillion in 2025, according to government data released Wednesday. The remarkable achievement comes despite heightened trade tensions with the United States, as Chinese manufacturers successfully expanded into alternative global markets.

Exports rose 5.5% over the year to reach $3.77 trillion, while imports remained virtually unchanged at $2.58 trillion. The 2025 surplus represents a significant increase from the $992 billion recorded in 2024, crossing the symbolic $1 trillion threshold that was first breached in November’s cumulative data.

December’s performance exceeded analyst expectations, with exports climbing 6.6% year-over-year, up from November’s 5.9% growth. Import growth also accelerated in December, reaching 5.7% compared to November’s 1.9%.

The trade data reveals a significant shift in China’s export destinations following President Donald Trump’s return to office and his renewed tariff offensive against Chinese goods. Exports to the United States plummeted by 20% in 2025, but this decline was more than offset by robust growth in other regions.

African markets emerged as particularly strong performers, with exports surging 26%. Southeast Asian countries followed with a 13% increase, while the European Union and Latin America saw gains of 8% and 7%, respectively. This geographical diversification has proven crucial to China’s continued export success.

Electronics and electrical equipment remained China’s largest export category, growing 8.4% year-over-year. The automotive sector was another standout performer, with the China Association of Automobile Manufacturers reporting a 21% jump in vehicle exports to over 7 million units. This growth was primarily driven by electric vehicles and plug-in hybrids, sectors where Chinese manufacturers have established significant competitive advantages.

Other strong export categories included computer chips, related materials, grain, and fertilizer. However, traditional labor-intensive exports like furniture and footwear saw declines.

“We continue to expect exports to act as a big growth driver in 2026,” said Jacqueline Rong, chief China economist at BNP Paribas. Her assessment reflects the broader consensus that external demand will remain a crucial pillar supporting China’s economy, which has been targeting annual growth of about 5%.

This export-led growth model, however, is creating tensions with trading partners concerned about market disruption. The head of the International Monetary Fund recently urged China to address economic imbalances by shifting away from export dependence and stimulating domestic demand.

Wang Jun, vice minister of China’s customs administration, acknowledged that China faces a “severe and complex” external trade environment in 2026, but maintained that the country’s “foreign trade fundamentals remain solid.”

China’s domestic economy continues to struggle with weak consumer confidence, largely due to a prolonged property market downturn that began after authorities cracked down on excessive borrowing. Government attempts to boost domestic consumption, including trade-in subsidies for appliances and vehicles, have had limited impact.

“We expect domestic demand growth to stay tepid,” Rong noted. “In fact, the policy boost to domestic demand looks weaker than last year – in particular the fiscal subsidy program for consumer goods.” Automobile sales, for example, grew 6% overall in 2025 but declined toward year-end as subsidies were scaled back.

Gary Ng, senior economist at Natixis, forecasts more moderate export growth of about 3% for 2026, down from 2025’s 5.5%. Nevertheless, with imports expected to remain sluggish, he predicts China’s trade surplus will stay above the $1 trillion mark this year, maintaining the country’s position as a global export powerhouse despite increasing international challenges.