China’s exports in December up 10.7 per cent, beating estimates as higher US tariffs loom

Exports rose by 10.7% compared to the same month last year, surpassing economists' expectations of a 7% increase. Imports, on the other hand, rose by 1% year-on-year, defying analysts' forecasts of a 1.5% decline.
Image used for representational purposes only
Image used for representational purposes only
Updated on
3 min read

HONG KONG: China's exports in December grew at a faster-than-expected pace as factories rushed to fill orders in anticipation of higher tariffs threatened by U.S. President-elect Donald Trump once he takes office.

Exports rose by 10.7% compared to the same month last year, surpassing economists' expectations of a 7% increase. Imports, on the other hand, rose by 1% year-on-year, defying analysts' forecasts of a 1.5% decline. As exports outpaced imports, China's trade surplus surged to 104.84 billion dollars.

Trump has pledged to raise tariffs on Chinese goods and close loopholes that exporters currently use to sell products more cheaply in the U.S. If these plans are enacted, they are expected to increase prices in the U.S. and squeeze sales and profit margins for Chinese exporters. However, Zichun Huang of Capital Economics believes China's exports will remain strong in the near term as businesses rush to front-run the anticipated tariff hikes. "Outbound shipments are likely to stay resilient, supported by further gains in global market share, thanks to a weak real effective exchange rate," Huang wrote in a note. Nonetheless, she warned that exports could weaken later in the year if Trump follows through on his tariff threats.

Officials in Beijing reported that the total value of China's imports and exports reached a record 43.85 trillion yuan (nearly $6 trillion) in 2024, marking a 5% increase from the previous year. China remains the world’s largest exporter and the primary trading partner of over 150 countries and regions, according to Wang Lingjun, deputy director-general of the Customs Administration. Despite a slowdown in other sectors of China’s economy, partly due to the pandemic and a downturn in the housing industry, exports have surged. Under President Xi Jinping, the ruling Communist Party has been promoting the upgrading of factories and a shift towards high-tech manufacturing.

The report highlighted that China’s export of mechanical and electrical products increased by nearly 9% in 2024, with exports of high-end equipment growing by more than 40%. Specific sectors saw impressive growth, with exports of electric vehicles rising by 13%, 3D printers jumping almost 33%, and shipments of industrial robots surging 45%. E-commerce trade, including sales from companies like Temu, Shein, and Alibaba, reached 2.6 trillion yuan ($350 billion), more than double the level seen in 2020.

While China aims to increase its imports, the value of imports still lagged behind exports, partly due to lower prices for key commodities such as oil and iron ore. Officials noted that there is still significant room for growth in imports, citing China’s large market capacity and vast potential. However, China is blocked from importing some products due to trade restrictions, particularly in strategically sensitive areas such as advanced semiconductors and military-related items. "Some countries politicize economic and trade issues and unreasonably restrict the export of certain products to China. Otherwise, we would import more," said Lv Daliang, a spokesperson for China’s Customs Administration.

China has made efforts to expand trade with countries participating in its Belt and Road initiative, which focuses on infrastructure construction and trade across much of the globe. Trade with these countries accounted for about half of China’s total trade last year. Additionally, China has eliminated tariffs on imports from the world’s poorest countries. While China values its trade with these new partners, it also maintains strong trade relations with traditional markets such as Europe and the U.S. Two-way trade with the U.S. grew nearly 5% last year, with China importing agricultural products, energy, medicines, and aircraft from the U.S. and exporting clothing, consumer electronics, and household appliances in return.

U.S. officials and critics have raised concerns that China’s expansion of exports is an attempt to compensate for sluggish demand at home as the economy slows. They argue that China is facing an “overcapacity” problem, with factories in certain industries operating well below capacity. However, Chinese officials have rejected this notion. “This is a false proposition,” said Wang Lingjun, the Customs Administration’s deputy director-general.

He added that China’s industries have become more efficient through upgrading, investment, and innovation supported by research and development. Furthermore, he emphasized that China’s complete manufacturing industry chain has helped stabilize global production and supply chains, driving technological progress and industrial upgrading worldwide.

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