China's exports rise sharply despite slump in US trade, but surge may be short-lived

China's exports rose 8.1 per cent in April compared to the previous year, far exceeding economists’ forecasts of around 2 per cent. The robust performance appears to reflect the tail end of a rush by companies and consumers to beat higher that took effect last month.

However, the month-on-month increase in exports was just 0.6 per cent, signalling a deceleration in trade momentum.

The strong annual rise in April exports was slower than the 12.4 per cent year-on-year increase recorded in March, suggesting the surge may be short-lived. Imports fell by 0.2 per cent from a year earlier but rose nearly 4 per cent compared to March, reflecting a modest rebound in domestic demand.

Trade with the United States — a politically sensitive topic — was hit hard. Shipments to the US plunged by 21 per cent in dollar terms, as tariffs on Chinese exports rose to as high as 145 per cent. Imports from the US also declined sharply, dropping over 13 per cent year-on-year. Consequently, China's trade surplus with the US narrowed to USD 20.5 billion in April, down from around USD 27.2 billion a year earlier.

In the first four months of 2025, exports to the US were down 2.5 per cent year-on-year, while imports from the US declined 4.7 per cent. Business between the world's two largest economies remains clouded by uncertainty, with China's retaliatory tariffs on US goods standing at 125 per cent.

A potential easing of tensions may be on the horizon, with US treasury secretary Scott Bessent and other senior officials scheduled to meet their Chinese counterparts in Geneva this weekend. However, analysts remain cautious.

Zichun Huang of Capital Economics noted that while some punitive tariffs may be rolled back, a complete reversal is unlikely. “China’s exports to the US are set for further declines over the coming months, not all of which will be offset by increased trade with other countries. We still expect export growth to turn negative later this year,” Huang stated.

Despite the strain in US-China trade relations, China’s exports to other parts of the world have remained resilient. In the first four months of the year, exports to Southeast Asian countries rose 11.5 per cent, while shipments to Latin America increased by an identical margin.

Exports to India surged nearly 16 per cent and exports to Africa climbed 15 per cent. Within Asia, exports to Vietnam jumped 18 per cent and those to Thailand soared 20 per cent, indicating a broader diversification of trade ties.

This shift underscores a global restructuring of supply chains that began several years ago and has accelerated amid US tariff hikes and the post-pandemic push for greater resilience. The European Union and Southeast Asia are now larger regional export markets for China than the United States.

Meanwhile, trade with the 15-nation Regional Comprehensive Economic Partnership (RCEP) and participants in China’s Belt and Road Initiative surpasses that with the US.

Domestically, China’s economy continues to face headwinds from a prolonged property sector slump and the lingering effects of the pandemic. Recent data show a slowdown in shipping and broader trade activity.

In response, Beijing has rolled out a raft of measures aimed at cushioning the economy from the impact of the trade war and boosting domestic momentum.

With agency inputs