Trade & Exports

China's export engine is still running at high volume with a near-record goods surplus, but the shape of that trade is shifting: the mix moves up the value chain and the geographical center of gravity tilts toward non-US markets. Fresh data from Zhejiang show trade with other SCO members hit a record 292.03 billion yuan in Jan–Jul (+9.8% year-on-year), with imports up 20.2% ¹. At the same time, Washington is keeping up pressure: Treasury Secretary Scott Bessent told the G20 in Asheville that China's massive surplus is unsustainable and urged countries hit by Chinese exports to re-examine trade terms, even while bilateral tariff-reduction talks continue ². The combination—more diversification, more pressure—is the core dynamic.

The value-chain story is strongest in Liaoning. Jan–Jul exports rose 12.2% to 2634.8 billion yuan, and machinery and electronics now make up 53.3% of exports, up 2.9 percentage points. Ship exports grew 1.78 times and industrial robots jumped 164.2% ³. Hengli Heavy Industry won two more VLCC orders from Greece's Danaos, bringing the Greek owner's total to 20, and a first contract with Italy's Pemont for two LRII product tankers—entry into the southern-European high-end ship market ³. This is the 'smile curve' shift: Chinese producers are capturing design, core-component and after-sales value, not just assembly.

Green mobility repeats the pattern in Jiangsu. Jan–Jul electric motorcycle and bicycle exports rose 38.8% to 66.2 billion yuan and electric passenger cars rose 3.8% to 335.8 billion yuan; Taicang port cleared about 790,000 vehicles (+80%), including about 480,000 new-energy vehicles (+102%) ⁴. The export form is upgrading too: Malaysia's Kuching project, 38 hydrogen-energy smart rail trains on a 69.9-km line, is being commissioned as a system rather than just rolling stock, and Wujin Bonded Zone has halved the VAT-refund cycle for bonded vehicle exports ⁴. Shandong shipped articulated CNG buses to Cartagena, Colombia, on August 29 ⁵. Green-mobility exports are deepening in both value-added and geographic scope.

Macro conditions keep external demand resilient. The August manufacturing PMI rose 0.6 points to 49.8, with the new-orders index above the line at 50.6 (+2.1) and production at 50.4 ⁶. But small firms remain at 47.9 and employment fell to 48.7, so domestic demand is not yet strong enough to carry the economy by itself ⁶.

The risk side keeps accreting. On August 31 the US Federal Register carried final affirmative anti-dumping and countervailing determinations on van-type trailers and subassemblies from China ^7,8. Bessent's G20 framing deliberately targets China's surplus, and US voices are trying to drag Beijing into the US–Canada trade dispute, even though Chinese analysts note Canada's diversification is a response to Washington's protectionism ⁹. The multilateral layer is where pressure is building faster than the bilateral tariff track.

Diversification is now measurable in new places. Zhejiang's trade with other SCO members hit a record 292.03 billion yuan in Jan–Jul, with exports up 7.7% and imports up 20.2% ¹. Hainan's zero-tariff coverage has expanded from 21% to 74% of tariff lines (6,600+ products), and Zhengzhou Xinzheng Comprehensive Bonded Zone posted 288.3 billion yuan, +33.7% ^10,11. The fifth Global Digital Trade Expo, opening September 23 in Hangzhou, will showcase quantum computing, brain-computer interfaces, eVTOL aircraft and AI-powered trade tools—a push to export digital technologies and services, not just goods ¹². Domestic policy, meanwhile, still tilts toward consumption subsidies: Jiangsu now offers a 15% rebate on humanoid robots and drones, which stimulates local spending, not imports ¹³.

Outlook: high export volumes and a large surplus persist, value-chain upgrading continues, and non-US diversification is broadening. The principal risk is the accretion of barriers—bilateral US remedies now compounded by G20-level imbalance debate. The next real tests are full-year 2026 destination data and the G20 communiqué.