China’s exports to the United States collapsed in May, plunging 34.5% year-on-year in the sharpest drop since the pandemic-era crash of early 2020. The dramatic fall underscores escalating trade tensions and the deepening economic fallout from tit-for-tat tariffs between Washington and Beijing, even as both sides attempt to stabilize relations.
Overall, China’s exports were 4.8% up in May from a year earlier, falling short of economists’ expectations for a 5% gain. Customs data released Monday showed that while trade with other global partners remained resilient, U.S.-bound shipments dragged heavily on overall growth. Imports also disappointed, dropping 3.4% against forecasts for a 0.9% decline, highlighting continued weakness in China’s domestic demand.
China’s trade surplus with the United States narrowed sharply, shrinking 41.55% year-on-year to $18 billion as American imports into China also fell by more than 18%. Despite this, China’s total trade surplus still expanded 25% from a year earlier, reaching $103.2 billion in May, buoyed by stronger exports to Southeast Asia, Europe and Africa. Shipments to Southeast Asia jumped nearly 15%, while exports to the European Union rose 12%, and exports to Africa surged over 33%.
The steep decline in U.S.-bound exports came in the immediate aftermath of U.S. President Donald Trump’s decision to impose fresh 145% tariffs on Chinese goods in April. Beijing swiftly retaliated with triple-digit tariffs and stricter controls on critical mineral exports. While many of those tariffs were rolled back following a partial trade truce negotiated in Geneva last month, the damage to trade flows in May was already evident.
“The prohibitive tariffs were only lifted in mid-May, but the damage was already done,” said Tianchen Xu, senior economist at the Economist Intelligence Unit. Xu expects a rebound in U.S.-bound shipments starting in June, which will be the first full month of reduced tariffs in effect. Currently, U.S. tariffs on Chinese goods stand at 51.1%, while Chinese tariffs on American imports sit at 32.6%, according to data from the Peterson Institute for International Economics.
Sectoral data revealed further divergence in trade flows. Exports of rare earths fell 5.7% to 5,865.6 tons as China tightened export controls on these strategic minerals. Exports of automobiles and ships increased 22% and 5%, respectively, while smartphone and home appliance exports contracted by about 10% and 6%. Meanwhile, soybean imports into China surged 36.2% year-on-year to a record 13.92 million metric tons. – By MENA Newswire News Desk.