In March, China’s export activity showed growth that exceeded preliminary expectations regarding the dynamic of this indicator, as businesses frontloaded outbound shipments to avoid prohibitive tariffs from the United States.
The export data stands in stark contrast to the Asian country’s import figures, which are on a downward trajectory amid continued sluggish domestic demand.
Chinese exports in March showed an increase of 12.4% compared to the indicator recorded in the same period last year. The relevant information was published by the Asian country’s customs authority on Monday, April 14th. It is also worth noting separately that the March result of China’s export activity turned out to be the biggest jump since October last year.
Experts interviewed by the media predicted that the mentioned indicator for the specified period would grow by 4.4%. The final result significantly exceeded the preliminary expectations, becoming an example of the fact that sometimes reality turns out to be bigger than the ideas about it.
In the current month, trade uncertainty has become a shock factor, provoking more than significant turbulence in the markets. The corresponding situation has already been observed, but it rapidly intensified as a process after President of the United States Donald Trump announced reciprocal tariffs against almost all countries on April 2. Then he unexpectedly stated about a pause in raising levies for goods imported from a dozen countries. However, at the same time, Donald Trump announced another tariff increase on products shipped from China. The Asian country imposed retaliatory measures. As part of the trade war, which is gradually moving into the category of facts of objective reality from the category of potential scenarios, the main battleground is the confrontation between Washington and Beijing. Both the United States and China are demonstrating their willingness to further escalate tensions. At the same time, it is worth noting that both sides will face significant losses in the implementation of the most negative scenario, which provides for a tightening of the trade war, which also carries the risks of an active confrontation between Beijing and Washington in other areas. This process is definitely unfavorable for China, as its economy, which is the second-largest in the world, relies heavily on exports, which will begin to decline in the face of a deteriorating external economic environment. The March figures do not negate this statement, as the relevant data reflect the state of affairs before April 2, when the Asian country faced a sharp increase in tariffs from the US. Beijing can potentially compensate for the upcoming losses by diversifying shipments, strengthening economic ties with other countries, primarily in Asia, and stimulating domestic demand, but it is unlikely to be able to completely avoid the negative consequences of Donald Trump’s levies.
According to media reports, citing economists, the symbolic light of optimism radiated by the March data on Chinese exports will be overshadowed by the leaden clouds of rapidly deteriorating prospects. The trade war for the Asian country is not likely to become an insignificant factor of impact.
Julian Evans-Pritchard, head of China economics at Capital Economics, said in a note to clients that export growth accelerated in March as manufacturers rushed to ship goods to the United States before Donald Trump announced reciprocal tariffs. The expert expects the mentioned indicator to drop back in the coming months and quarters.
Chinese imports in March showed a drop of 4.3% compared to the same period last year. At the same time, economists surveyed by the media expected this indicator to decrease by 2% over the mentioned period.
It is worth noting that in January-February of the current year, the growth of Chinese exports showed a significant slowdown. The corresponding indicator increased by only 2.3% year-on-year. These growth rates are the slowest since April 2024.
The decline in Chinese imports is showing acceleration. In the first two months of 2025, the corresponding figure fell by 8.4% year-on-year. These rates of decline are the fastest since mid-2023.
Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, also predicts a weakening of Chinese exports in the coming months amid a sharp increase in tariffs from the United States. In the short term, the expert expects chaos in supply chains and potential shortages in the US, which could drive up inflation.
Zhiwei Zhang also noted that trade policy has remained extremely uncertain recently, which has exacerbated problems for businesses that have sought to adjust supply chains and capital spending plans. In this context, the expert separately underlined that even if companies decide to relocate their supply chains, it will take time to build factories.
It is worth noting that the relocation of production sites outside of China is one of the most significant pain points in adapting firms to the new global trading realities. Over the years, the Asian country has consistently transformed into a kind of world’s manufacturing center. It will be very difficult to form an alternative large-scale production space. In the context of this statement, it is worth noting that the process of building factories is costly in many ways and is not a task that can be solved very quickly for objective reasons. Also, not every country has a sufficient number of skilled workers.
The Chinese authorities have set an economic growth target of about 5% for the current year. The prospects that the mentioned indicator will become a reality are definitely not the maximum against the background of the escalation of the trade war and domestic demand, which continues to show a low degree of intensity.
Since his inauguration in January, Donald Trump has imposed cumulative 145% tariffs on goods imported from the Asian country. It is worth noting that these measures apply to all products shipped from China to the United States.
As part of the retaliatory actions, Beijing increased its tariffs on US goods to 125%.
Lingjun Wang, the vice head of customs administration, said at a press conference Monday that the United States government’s abusive use of tariffs has created headwinds for global trade. It was also noted that the Asian country will implement all tariffs announced for the US strictly in accordance with the law. Moreover, it was underlined that the Asian country will continue to open up its economic system for mutually beneficial trade and investment cooperation with countries around the world. This is another statement from Chinese officials, which unequivocally signals that Beijing, in the context of the current conditions and circumstances of the world’s trade reality, intends to build a reputation for itself as a defender of globalism as a configuration of the world order, including in the economic dimension of the relevant system. It is likely that China, at least at the level of official rhetoric, will position itself as a kind of antagonist to the protectionist measures of the United States.
The Asian country’s retaliatory measures against the US tariffs probably indicate that Beijing is significantly confident in its economic strength, perceiving it as sufficient to cope with the challenges generated by the realities of the trade war.
China’s exports to the United States grew 9.1% in terms of total values year-on-year in March. Despite the tensions, Washington continues to be Beijing’s largest trading partner. The share of the United States in China’s total trade is about 10%.
Chinese exports to the Association of Southeast Asian Nations increased by 11.6% year-on-year in March. Shipments of products from China to the European Union rose by 10.3% last month compared to the same period in 2024.
Chinese semiconductor exports grew by more than 25% year-on-year in March. Shipments of rare earths from an Asian country abroad increased by 20% last month compared to the same period in 2024.
