Recently, China’s exports and trade have repeatedly reached new highs. Statistical data shows that in the first 11 months of 2025, China’s products overseas sales exceeded $3.4 trillion. The trade surplus of exports over imports accumulated to $1.08 trillion.
Major media outlets have taken note of these record-breaking numbers and reported extensively on them. The Wall Street Journal, known for its calm demeanor amidst media noise, noted that these figures highlight the “dominance” of the Chinese economy. However, behind these dazzling total figures lie hidden concerns about the Chinese economy, and these concerns are likely to surface in the near future.
Notably, despite U.S. resistance to Chinese exports, China has still achieved these records. Over the years, even after former President Trump’s first term ended, the U.S. has imposed tariffs on Chinese goods entering the country and taken other measures to restrict trade with China. Since Trump returned to the White House in January, the government has further increased trade barriers, raised tariffs significantly, levied special port fees on Chinese vessels, and in other ways restricted Chinese products from entering the U.S. market.
While the European Union is not as aggressive and vocal as President Trump, it has also taken similar measures, imposing high tariffs on Chinese-made electric vehicles and seeking other ways to protect the “industrial and innovative model” of the continent recently mentioned by French President Macron. Macron even threatened to impose higher tariffs on Chinese products if the China-EU bilateral trade does not achieve balance.
However, despite China’s seemingly bright performance in trade, it is undeniable that the U.S. and Europe’s resistance has severely impacted China’s export engine. Data from November shows that China’s exports to the U.S. have plummeted by nearly 30% compared to the same period last year.
Earlier this year, China’s exports to Europe had seen a significant increase, primarily due to the shift away from the increasingly challenging U.S. trade.
However, by mid-year, Europe’s resistance to Chinese products began to show. As of October (the latest period for which complete data is available), China’s exports to Europe decreased by 11.3% compared to May, roughly on par with the levels in October 2024.
The record-breaking Chinese exports that have sparked great enthusiasm in the media are entirely due to China’s dramatic shift towards markets in what is commonly referred to as the “Global South,” including the ASEAN market, as well as other regions in Asia, India, the Middle East, Africa, and Latin America.
China’s exports to all these regions have shown significant growth. Exports to ASEAN countries increased by 11% compared to the same period last year, exceeding $53 billion, which is more than 50% higher than China’s exports to the U.S. and Europe. China’s exports to ASEAN and other regions have offset losses in the U.S. and Europe.
However, China’s response strategy for 2025 is likely to prove unsustainable. The initial surge in sales from China’s export transformation cannot be repeated year after year. Even if the Global South countries can achieve optimistic growth targets, the economies of these regions are still too small to replace the combined markets of Europe and the U.S.
Furthermore, these Global South countries will eventually follow the U.S. and Europe in resisting China’s “dominance” of products. These developing countries urgently need domestic production capabilities, and the influx of Chinese goods is suffocating this development space.
The more China relies on Global South countries, the louder the resistance against its products will become. For example, India is already displeased with the decline in its sales to China while Chinese imports soar. This fiscal year, India’s trade deficit with China has widened to nearly $100 billion, a significant increase from $85 billion in 2024. Mexico, Indonesia, and other countries have also expressed similar concerns about the dumping of Chinese products.
At a more fundamental level, China’s international trade success in 2025 also highlights its failure to develop a domestic demand-driven growth engine. The relative loss of Western markets should have reinforced Beijing’s efforts to find economic growth drivers from Chinese consumers and private investments. However, despite Beijing’s verbal support for these goals, the Chinese economy has not been able to achieve this transformation.
Indeed, China’s real estate crisis and other domestic economic issues have made the transition to an internal demand-driven growth model challenging. Beijing acknowledges that this transformation is crucial. The failure of this transition keeps China reliant on exports as before, making it more susceptible to overseas circumstances. When Global South countries (just like Europe and the U.S.) grow tired of the impact of China’s export wave on their economies, this vulnerability will become even more pronounced.