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China, explained.
Around 70 per cent of the world, or 145 economies, trade more with China than they do with America (Getty Images)
China’s unbalanced global trading relationships have only deepened.
China versus America on global tradeChina versus America on global trade
About the authors
Roland Rajah
Roland Rajah is Lead Economist and Director of the Indo-Pacific Development Centre at the Lowy Institute, focusing on economic development challenges across Southeast Asia, the Pacific Islands, and South Asia. His research spans macroeconomics, aid and development finance, geoeconomics, and regional integration.
Ahmed Albayrak
Ahmed Albayrak is a Research Associate in the Lowy Institute’s Indo-Pacific Development Centre.
The return of President Donald Trump to the White House means another trade war between the United States and China looks likely.
What has happened to global trading relationships since the last US–China trade war of 2018–19? Our latest Data Snapshot maps whether China or the United States is the larger trading partner for each economy in the world, and to what extent. This provides an update to our earlier popular exercise from 2019. We examine the value of two-way trade (i.e. exports plus imports) between two economies to measure trade integration using the International Monetary Fund’s Direction of Trade Statistics database. We also provide a breakdown by imports and exports separately.
The latest data show that China continues to deepen its trading network. Around 70 per cent of the world, or 145 economies, trade more with China than they do with America, while more than half of all economies now trade twice as much with China compared to the United States.
China’s trade relationships are, however, unbalanced. Prior to the pandemic, China’s exports were slowing due to softer global demand and US tariff hikes. Post-pandemic, China’s exports have surged by some US$1 trillion in annualised terms. With a weak domestic economy holding back imports, China’s goods trade balance was almost US$1 trillion last year. Strong US demand, by contrast, has seen it become even more important as a source of global export demand.
Protectionist responses to China’s surging exports by the United States, Europe, and others have thus far done little to slow China’s export juggernaut. However, with a more confident and determined Trump administration now in power, more drastic measures are on the horizon. For more details, check out the full data feature.
