The value of China’s trade surplus has topped $1trillion for the first time, despite US President Donald Trump’s barrage of tariffs on the world’s biggest exporter.
Official figures published on Monday show exports were stronger than expected in November, while relatively weak import levels continued to frustrate trade partners.
It means China’s trade surplus was worth $1.076trillion in dollar terms over the first 11 months of the year.
The figures, which measure goods but not services, compare to a trade surplus of just under $1trillion for the entirety of 2024.
It comes after a truce between Washington and Bejing was announced last month as the countries agreed to postpone export controls on rare earths and chips under a one-year deal.
Some US senators are currently attempting to stop Trump easing restrictions on exports of advanced AI chips to China by introducing the ‘Safe Chips Act’.
But analysts at UBS said that such moves may only delay China’s unrestricted access to the advanced technology.
Chinese export growth has been propelled by better than expected demand for ships, semiconductors and cars
They wrote in a note on Monday: ‘China’s domestic chip sector is gaining momentum.
‘Chinese startup Moore Threads Technology, often dubbed “China’s NVIDIA” in local media, soared more than five-fold in its Shanghai IPO and has raised $1.13billion.
‘Chip localisation is underpinning domestic tech resilience. Regardless of what happens to US advance chip exposures, China’s semiconductor sector is making its own rapid advances.
‘Chinese foundries and equipment makers are overcoming supply chain challenges, supported by government investment and vertical integration.
‘We estimate the localisation rate for AI chips in domestic data canters could reach 50 per cent by 2027, positioning China for greater independence in AI development, regardless of whether US export restrictions persist or not.’
Exports to the US plummet
Total Chinese exports were up 5.9 per cent in November, after falling 1.1 per cent in October, despite shipments to the US slowing to a three-month low.
Chinese exports to the US are down 18.9 per cent so far this year, but shipments to other regions have shown strong growth – prompting some economists to suggest some exports are later being trans-shipped to the US to circumvent tariffs, according to the Financial Times.
Year-on-year growth of 5.4 per cent so far in 2025 has been propelled by better than expected exports of ships, semiconductors and China’s booming auto industry.
Exports that traditionally rely heavily on the US market, such as toys, footwear and furniture, have fallen heavily this year but have still held up better than expected.
EU poses new tariff threat
Imports picked up slightly with 1.9 per cent but continued to disappoint amid soft domestic demand
Hi-tech import growth of 8.7 per cent helped to offset an ongoing decline in demand for building materials like lumber and steel, reflecting ongoing woes in China’s property sector.
Lynn Song, chief economist for Greater China at ING, said: ‘China’s soft imports have raised concerns among trading partners, such as the EU.
French President Emmanuel Macron has warned that the EU might hike tariffs on China if these imbalances are not addressed in the coming months.
‘Such a timeline would likely be too aggressive to resolve this issue. China’s pivot to establishing domestic demand as a key driver of growth will take time, but it’s essential for China to move into the next phase in its economic development.
‘Ultimately, we need to see what concrete measures are put in place to boost domestic consumption next year.
‘The 15th Five-Year Plan mentioned plans to increase win-win external cooperation and establish international consumption centres, both of which sound positive for addressing trade imbalances.
‘How soon these measures come through could impact how trading partners react in the coming months and years.’
DIY INVESTING PLATFORMS
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