China's Trade Surplus Hits Record $1.2 Trillion Despite US Tariffs — Outpaces Historic German, Japanese Highs

Despite tariffs and escalating trade tensions, China’s trade surplus has surged to unprecedented new levels over the past 12 months, significantly outpacing the historic highs of Germany and Japan.

Non-U.S. Markets Lead The Surge

On Monday, in a post on X, The Kobeissi Letter highlighted China’s “record $1.2 trillion” trade surplus over the past 12 months, citing data from Bank of America’s Global Investment Strategy team.

The nation’s positive trade balance has “DOUBLED over the last 5 years,” even as the tariffs imposed by the U.S. government remain in place, according to the post.

See Also: Trump’s Tariff Storm Could Soon Hit American Consumers: Here’s Why

It also notes that China’s exports to the world, excluding the U.S., have witnessed a strong rebound, growing $400 billion, “to a record $3.2 trillion over the last 18 months,” clearly showing the nation’s deepening trade ties outside of the U.S.

China's manufacturing sector is also posting historic numbers, with the cumulative 12-month manufacturing surplus hitting “a record $2 trillion, well above the largest surpluses historically seen in Germany and Japan.” This places the country firmly ahead of two of the world's most prominent manufacturing economies.

“Melting Ice Cube,” Hidden Surpluses And More

According to investor Peter Thiel, America's trade gap with China runs deeper than headline numbers suggest. He noted that "about a quarter of the U.S. trade deficit is bilaterally with China and another quarter is indirectly with China," pointing to imports from other countries that contain substantial Chinese components or value-added contributions.

Economist Brad Setser has similarly raised concerns regarding how China reports its trade data, saying that the country is masking billions of dollars in unreported income, which he predicts is north of $500 billion.

This comes as the U.S. makes efforts to narrow its trade gaps, with Treasury Secretary Scott Bessent describing tariffs as a “melting ice cube” that could shrink substantially or disappear altogether as the nation works to "rebalance" its $1.18 trillion current account deficit.

Read More:

• Trump Urges China To Quadruple US Soybean Purchases To Address Their Shortage, Tackle Trade Deficit—Experts Say ‘Highly Unlikely’

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