Natálie Dvořáková
- 11 November 2025
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 7, 2025Details
- Abstract
- Debate over China’s growing trade surplus has resurfaced amid US-China trade tensions, geoeconomic shifts and global imbalances. This box shows that the surplus reflects two distinct dynamics: persistently weak imports and surging exports. On the import side, structural policies promoting domestic substitution, trade restrictions and sluggish demand have curbed demand for foreign goods. On the export side, subdued domestic demand has led firms to redirect excess production capacity abroad, consistent with the “vent-for-surplus” mechanism. Sectoral evidence shows that this channel outweighs tariff-related trade diversion.
- JEL Code
- F13 : International Economics→Trade→Trade Policy, International Trade Organizations
F14 : International Economics→Trade→Empirical Studies of Trade
O53 : Economic Development, Technological Change, and Growth→Economywide Country Studies→Asia including Middle East