The FDI angle:

  • Chinese exports grew 3.8% year-on-year in H1 2024, reaching $1.71tn.
  • China’s trade surplus hit a record $99bn in June 2024, reflecting higher exports and lower imports amid weak domestic demand.

Why it matters: rising Chinese exports and trade surplus increase global trade imbalances, prompting tariffs and trade restrictions impacting foreign direct investment in key sectors such as electric vehicles.

Chinese exports grew year-on-year by 3.8% in the first half of 2024, as concerns mount in other countries about widening trade imbalances with China and its potential to displace domestic industries and jobs.

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In the first half of (H1) 2024, Chinese companies sold goods and services worth $1.71tn abroad — up from $1.64tn in the same period a year earlier and 46% higher than the $1.17tn recorded in H1 2019, according to fDi calculations of figures from Trade Data Monitor (TDM). In June 2024, China’s trade surplus with the world also hit a monthly record of $99bn, as exports surged and weaker domestic demand in China led to a fall in imports.

A remarkable 202 out of 233 countries and areas with available data via TDM recorded an increase in Chinese exports between H1 2019 and H1 2024. This reflects a longer-term trend of expanding Chinese trade with the world since the country joined the World Trade Organization in December 2001. 

Despite a 4.6% annual decline in the absolute value of Chinese exports in 2023, the three-year moving average reached its highest ever level of $3.41tn for the 2021–2023 period. China’s annual trade surplus broke records in 2022 and remained above $822bn last year, according to fDi calculations of Chinese exports and imports data from TDM.

China’s widening trade surplus has caused concern among many foreign politicians, who worry that competition from Chinese exports could displace domestic industrial production, forcing factory closures and job losses. Governments in some of China’s largest export markets, including the US, EU, India, Brazil and Turkey, have raised existing tariffs and imposed new trade restrictions on manufactured goods from China. Many tariffs are focused in sectors such as electric vehicles (EVs) and other clean tech, in which countries are trying to develop domestic industries.

More reading on China:

Chinese EV makers like BYD have signed agreements to set up production facilities in countries like Mexico and Turkey to get around tariffs. Lynn Song, the chief China economist at ING Bank, wrote in a note that there could be a “frontloading effect” before auto tariffs from the EU and US took effect, “but tariffs could lead to a slowdown in [Chinese] auto exports towards the end of the year”. 

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Recent growth in Chinese exports has been remarkable. Between 2019 and 2023, the value of China’s exports to the world rose by 35.2% to $3.38tn and increased in 199 out of 235 countries and areas with available TDM data. A closer look at China’s largest export markets with at least $1bn worth of exports in 2023 reveals the economies where Chinese companies have increased their exports the most.

Last year, Zimbabwe recorded Chinese exports worth $1.4bn, more than three times the $368.8m of exports recorded in 2019, making it the country where Chinese exports have grown the most in value in the past five years. The South African country ranked 113rd in the list of China’s export destinations in 2023.

In a close second came the Republic of Congo, where Chinese exports grew from $435m to $1.49bn over the same period. Belarus, which has had EU sanctions imposed on it since a “fraudulent” 2020 presidential election, placed third with Chinese exports growing by 225% to $5.87bn between 2019 and 2023. Several countries that have had a recent surge in Chinese FDI, including Serbia, Uzbekistan and Turkey, were also among the 20 countries where Chinese exports have grown the most in the past five years.

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