China reported a record annual trade surplus of $1.189 trillion on Wednesday, according to customs data. The figure, comparable to the GDP of a top-20 global economy, first surpassed the trillion-dollar threshold in November.
Outbound shipments grew 6.6% in value terms in December from a year earlier, exceeding a Reuters poll forecast of 3.0%. Imports rose 5.7%, also beating expectations.
Monthly export surpluses exceeded $100 billion seven times last year, up from just once in 2024. This occurred as Chinese producers prepared for three more years of a Trump administration aiming to shift U.S. orders to other markets.
Since President Donald Trump returned to the White House last January, Chinese firms have shifted focus to Southeast Asia, Africa, and Latin America to offset U.S. duties. The resilience to renewed tariff tensions has emboldened this move.
Beijing looks to exports to counteract a prolonged property slump and sluggish domestic demand. The record surplus risks unsettling economies concerned about China's trade practices and overcapacity.
Economists expect China to continue gaining global market share this year. Chinese firms are setting up overseas production hubs for lower-tariff access to the U.S. and EU, and demand for lower-grade chips and other electronics remains strong.
China's auto industry, a flagship of its global industrial ambitions, saw overall exports jump 19.4% to 5.79 million vehicles last year. Pure EV shipments rose 48.8%. China would likely remain the world's top auto exporter for a third year.
Beijing has shown signs of recognizing it must moderate industrial exports to sustain success. The leadership has been increasingly vocal about imbalances in China's economy and the image problem outsized exports are causing.
Last week, Chinese Premier Li Qiang was quoted on national television calling for "proactively expanding imports and promoting the balanced development of imports and exports." This followed November's trillion-dollar surplus data.
The country also scrapped subsidy-like export tax rebates for its solar industry, a long-standing point of friction with EU states.
Lawmakers last month passed revisions to the Foreign Trade Law after two, rather than the usual three readings. This signals to members of a major trans-Pacific trade pact that China is prepared to shift from industrial subsidies toward freer, more open trade.
Despite a year-long truce on tariffs struck by Trump and Chinese President Xi Jinping in late October, U.S. duties of 47.5% on Chinese goods remain well above the roughly 35% level analysts say enables Chinese firms to export to the U.S. at a profit.