China recorded a record annual trade surplus of nearly $1.2 trillion in 2025, marking the first time the country's trade surplus exceeded $1 trillion. This surplus was primarily driven by an increase in exports to various global markets, which offset a reduction in shipments to the United States. Concurrently, China's economy expanded by 5% in 2025, aligning with its official growth target, despite ongoing challenges in its domestic property sector and cautious consumer spending.
Record Trade Surplus Achieved
Customs data released in early 2026 indicated that China's trade surplus for 2025 reached approximately $1.19 trillion. This figure surpassed the 2024 surplus of over $992 billion. Monthly export surpluses exceeded $100 billion seven times during 2025, compared to once in the previous year.
Export and Import Dynamics
Total exports for 2025 rose by 5.5% to $3.77 trillion. In December 2025, exports grew by 6.6% year-on-year in dollar terms. Imports remained relatively stable at $2.58 trillion for the year, showing a 5.7% year-on-year increase in December. The significant surplus has been attributed to strong international demand for Chinese goods and a comparatively weaker domestic market, which reduced the demand for imports. Additionally, a weaker yuan and inflation in Western countries contributed to the attractiveness of Chinese exports.
Specific product categories contributing to export growth included computer chips, other electronic devices, and automotive exports. China's overall automotive exports increased by 19.4% to 5.79 million vehicles in 2025, with pure electric vehicle shipments rising by 48.8%. The country is projected to maintain its position as the world's top automotive exporter.
Market Diversification Amidst Tariffs
Exports from China to the United States decreased by 20% in 2025, and imports from the U.S. were down by 14.6%. This decline followed the implementation of tariffs by the United States, which at one point reached 145% before being adjusted to 47.5%.
In response to these measures, China expanded its export activities to other international markets. Notable increases in exports were reported for:
- Africa: 25.8% to 26%
- Southeast Asian nations (ASEAN bloc): 13% to 13.4%
- European Union: 8% to 8.4%
- Latin America: 7%
Chinese firms reportedly reoriented orders and focused on markets in Europe, Africa, Latin America, and other parts of Asia. Some reports suggested the use of indirect shipping routes, known as trans-shipping, through proxy nations with lower tariffs, potentially affecting official export figures to the U.S.
Economic Growth and Domestic Challenges
China's economy grew by 5% in 2025, meeting its official target. However, economic growth decelerated to 4.5% in the final three months of the year. This growth was supported by manufacturing and exports, while consumer spending remained cautious and the real estate sector continued to present challenges.
Domestic economic issues include a prolonged downturn in the property sector, with home prices reportedly declining over 20% since 2021. This situation has affected consumer confidence and domestic demand. China has also faced deflationary pressures, with consumer prices increasing by 0.8% in 2023.
Chinese leaders have indicated plans to increase household consumption as a percentage of the economy and implemented measures such as government trade-in subsidies for items like home appliances and vehicles.
External Environment and Outlook
Wang Jun, a vice minister at China's customs administration, described the external trade environment for China in 2026 as "severe and complex" but affirmed that the nation's "foreign trade fundamentals remain solid." The diversification of trading partners was highlighted as enhancing China's ability to manage risks.
Economists anticipate that China will continue to expand its global market share. Projections for 2026 suggest export growth of approximately 3%, a decrease from 2025's rate, with the trade surplus expected to remain above $1 trillion due to anticipated slow import growth. Concerns have been raised by other countries, such as France, regarding the potential impact of an influx of inexpensive Chinese imports on local industries.
Demographic Shifts
Concurrently, data for 2025 showed China registered its lowest number of births since 1949, with a total of 7.9 million births. The nation's population decreased for the fourth consecutive year, falling by 3.4 million to 1.4 billion. Analysts project that this declining birth rate will exacerbate domestic issues by potentially reducing demand for housing and consumer goods.