China’s Export Surge Faces Headwinds as U.S. Tariffs Intensify

China’s exports likely accelerated in March as factories pushed out shipments ahead of U.S. President Donald Trump’s sweeping new tariffs. Economists expect outbound shipments to have risen 4.4% year-on-year, up from a 2.3% increase in the January-February period. The export boost comes amid growing fears over a prolonged U.S.-China trade war, which threatens to derail the global supply chain.

In contrast, China’s imports are expected to have continued shrinking, down 2% following a sharp 8.4% drop earlier this year. Weak domestic demand, rising unemployment, and ongoing deflation have intensified calls for further economic stimulus. March data also showed a 4.1% drop in South Korean exports to China—a key leading indicator of Chinese import activity.

While manufacturing and retail activity showed signs of recovery last month, heightened trade tensions are clouding the outlook. Trump’s administration recently slapped an additional 145% in tariffs on Chinese goods, despite temporarily pausing reciprocal duties on other nations. In response, Beijing retaliated with 84% additional tariffs on U.S. products.

The World Trade Organization estimates that bilateral trade between the U.S. and China could drop by as much as 80% due to the conflict. Reflecting the fallout, Goldman Sachs slashed its 2025 China GDP growth forecast to 4% from 4.5%, while Citi cut its outlook to 4.2%.

China’s March trade surplus is projected at $77 billion, down from December’s $104.8 billion but similar to last year’s level. The persistent surplus will likely keep China in Trump’s crosshairs as he pushes to narrow the U.S. trade deficit.

China’s official trade figures are set for release on Monday, offering key insights into how the world’s second-largest economy is weathering escalating trade tensions.