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China: Export jumped in March ahead of more tariff uncertainty
The tariff uncertainty has driven more frontloading activities in March. In USD terms, exports surged by 12.4% y/y (Bloomberg est: 4.6%, Feb: -3.0%) while it rose 13.5% y/y in CNY-terms (Feb: -1.9%). Exports to its key markets were higher, including to ASEAN (+11.6% y/y), EU (+10.3% y/y) and the US (+9.1% y/y). Shipments of mechanical & electrical products, LCD panels, automotive parts, garments and semiconductors registered strong growth in March.
However, the larger-than-expected drop in imports by -4.3% y/y (Bloomberg est: -2.1%, Feb: 1.5%) in USD-terms and by -3.5% y/y (Feb: 2.5%) in CNY-terms continued to indicate a weak domestic demand in China. China’s imports from Taiwan (+34.5% y/y) and ASEAN (+9.8% y/y) rose but its imports from sources such as the US (-9.5% y/y) and EU (-7.5% y/y) contracted. While imports of aircrafts and computers soared ahead of more tariffs, weak demand for other consumer goods suggested a more cautious outlook. In volume terms, imports of commodities were weaker for soya beans, iron ore, coal, LPG and refined petroleum products in March compared to the same period last year.
As such, China’s trade surplus widened sharply to US$102.64 bn in March from a monthly average of US$85.26 bn in the first two months of this year. Overall, China recorded a trade surplus of US$272.97 bn in 1Q25, of which US accounted for US$76.63 bn.
Overall in 1Q25, China’s exports rose 5.8% y/y while imports contracted by - 7.0% y/y. Export gains were seen across its key markets including to ASEAN (+8.1% y/y), US (+4.5% y/y) and EU (+3.7% y/y). However, China imported less from EU (-6.3% y/y) and US (-1.4% y/y) while registering a modest gain for ASEAN (+2.8% y/y) in 1Q25.
The temporary exemption of smartphones, computers and some other electronic devices from "reciprocal" tariffs (at 125% for Chinese goods) that was announced on 11 April may see further room for some frontloading of tech exports before Trump unveils sector specific tariffs on semiconductors and critical technology products from China. Trump’s latest exemptions apply to around a fifth (US$100 bn) of US’ imports from China, providing some cushion against products hit by the hefty “reciprocal” tariffs. The decoupling of US-China trade will have a significant impact on China’s export outlook. Despite the strong export growth in 1Q25, the momentum is expected to reverse as more tariffs set in and until US and China can arrive at a resolution to prevent further escalation in trade tensions.
We previously factored in marginal growth of around 1.0% for both China’s export and import in 2025 compared to growth of 5.9% and 1.1% respectively in 2024. However, downside risks have increased with a full-year contraction likely especially for imports.
Ho Woei Chen
Economist
Follow Woei Chen on LinkedIn
