Chinese Trade Surplus with Neighbors Grows

As domestic sales continue to slump, China continues to look for new markets abroad and has found them in Southeast Asia. Singapore-based The Straights Times even speaks of cheap Chinese goods that have been flooding Southeast Asia. U.S. tariffs on goods from the country exacerbated the pressure on Chinese producers to find new buyers, as will the newest announcement this Monday that Chinese retail sales growth had slowed and stayed behind expectations in April.

Data from the General Administration of Customs China shows that while the Chinese trade surplus with ASEAN countries was still smaller than China's trade surplus with the U.S., it was growing more rapidly. In Q1 of 2025, it reached $190 billion, more than double the 2021 figure. In comparison, the Chinese trade surplus with the United States reached a high that year at almost $400 billion before falling to $361 billion most recently.

Sources interviewed by The Straits Times said that due to the tariffs that were in place for Chinese exports to the U.S. for several weeks, Chinese producers saw goods pile up and tried to unload them at reduced prices in neighboring regions, selling them directly and at a discount on international Chinese e-commerce platforms, for example Taobao. The report also states that garment industries in Indonesia were affected, resulting in layoffs, due to an oversupply of Chinese textiles. In Thailand, ceramics and handicrafts were hit, while in Japan, it was electric cars due to China's new export prowess in the sector.