China trade balance grows more than expected in Jan-Feb as imports plunge

Published 07/03/2025, 04:50

Investing.com-- China’s trade balance expanded beyond expectations in the first two months of 2025, driven by an unexpectedly steep drop in imports amid U.S. trade tariffs and weaker domestic demand.

Trade balance grew to $172.50 billion in the January-February period, compared to expectations of $143.10 billion, government data showed on Friday. 

Imports fell 8.4% in Jan-Feb, in contrast to expectations for a 1% rise.

Exports rose 2.3% year-on-year, below expectations of 5% growth, and fell sharply from the 10.7% seen in December.

This decline is attributed to the escalation of a trade war with the U.S., involving reciprocal tariffs.

U.S. President Donald Trump imposed 10% tariffs on Chinese exports, effective from Feb. 4, and recently increased those levies to 20%, weighing on the exports.

China also announced retaliatory tariffs on U.S. goods, imposing 10%-15% retaliatory levies on U.S. agriculture exports. 

The steep decline in imports largely outweighed weaker-than-anticipated exports. 

Local demand in China is expected to improve this year, as Beijing doled out fresh stimulus measures at its annual parliamentary meeting, which was currently underway.

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