📈 U.S. Trade Deficit Shifts from China to the Rest of Asia

U.S. trade war shifted deficits: since 2018, America’s gap with China fell 29%, but surged 130% with the rest of Asia. Tariff hikes in 2025 deepened the trend.

Since the onset of the U.S.–China trade war in 2018, America’s trade deficit with China has declined, while its deficit with the rest of Asia has surged. In 2018, the U.S. trade deficit with China was more than twice that with other Asian economies. Between 2018 and 2024, the U.S. deficit with China fell by 29% ($31 billion), while the deficit with the rest of Asia rose by 130% ($65 billion). Following tariff escalation in 2025, the U.S. trade deficit with China dropped by 39% year-on-year ($26 billion) in Q2 2025, even as the deficit with the rest of Asia climbed by 28% ($33 billion).