China Announces Record Trade Surplus as Its Exports Flood World Markets

China announced on Wednesday the world’s largest trade surplus ever, even adjusting for inflation, as a tsunami of exports flooded markets around the world last year.

China’s surplus, the value of goods and services it sold abroad versus its imports, reached $1.19 trillion, an increase of 20 percent from 2024, according to data released by the country’s General Administration of Customs. The number had already exceeded $1 trillion through November.

The country’s surplus is still widening: for December alone, China’s surplus reached $114.14 billion, propelled by surging exports to the European Union, Africa, Latin America and Southeast Asia. It was the third-highest monthly surplus on record, trailing only January and June last year.

The enormous trade surplus for the full year came despite efforts by President Trump to use tariffs to contain China’s factories. The tariffs reduced China’s trade surplus with the United States by 22 percent last year. But Chinese factories increased sales to other regions, in many cases bypassing American tariffs by shipping goods to the United States through Southeast Asia and elsewhere.

Also driving up China’s surplus in trade was the country’s chronic weakness in imports, which were essentially unchanged last year. Beijing’s leaders have pursued an ambitious industrial policy to replace imports with domestic production. Their goal has been to build national self-reliance in many industrial sectors.

China reaffirmed its self-reliance goals in October when it unveiled an initial sketch of its five-year economic plan through 2030.

At the same time, the spending power of many Chinese families to buy imported cars, cosmetics and other products has withered, and their purchases of domestically produced goods have faltered as well. Since 2021, a housing market crash has erased the life savings of many Chinese who had invested in property, leaving them with little ability to buy the flood of goods pouring out of the country’s factories.

Much of those products are exported instead.

China’s trade surplus has also been propelled by a weak currency, which makes the country’s goods less expensive in foreign markets and its imports more expensive. The government allowed the currency, the renminbi, to weaken considerably during the Covid-19 pandemic and has barely allowed it to recover since, although there has been a slight rebound in recent weeks.

Inflation in the West has made China’s exports even more appealing in foreign markets. China suffers from deflation, a broad drop in prices prompted by widespread factory overcapacity and weak domestic demand.