What’s Up With China’s Trade Figures?

Commentary

Economists, statisticians, policymakers, and readers of the financial press have long been suspicious of economic figures coming out of Beijing, or, more specifically, from the Chinese Communist Party.

For example, see here and here. A recent illustration of just this problem of knowing what is really happening has arrived with the report on China’s trade from Beijing’s National Bureau of Statistics. The figures show powerful and relentless growth in Chinese exports during 2025 and into the first two months of this year, and then a sudden and largely inexplicable disappointment in the March accounting, the most recent data available.

Taking the figures at face value suggests that China’s trade with the rest of the world has taken quite a wild ride. Last year, despite Washington’s imposition of high tariffs on Chinese sales in what had been the country’s chief export destination, Beijing announced a stellar year for Chinese exports.

Although sales in the United States fell by some 20 percent, exports to the European Union in 2025 were reported to have risen by 8.4 percent, while sales in the member countries of the Association of Southeast Asian Nations rose by 13.4 percent and sales in Africa rose by 25.8 percent.

These reported offsets to losses in the United States pushed overall Chinese exports up by 6.6 percent for the year, helping China report a record trade surplus of the equivalent of almost $1.2 trillion.

Beijing’s statisticians claimed that this powerful performance continued into the first two months of 2026 but then abruptly reversed in March. For the January–February period, the National Bureau of Statistics reported an 11 percent decline in sales in the United States from the same period in 2025, but an exceptionally strong 28 percent growth in sales in the EU and a 16 percent jump in sales in Latin America, pushing overall exports for the two-month period up by almost 22 percent from the same period in 2025.

But then, in March, everything seemed to change. Chinese statisticians told the world that exports rose by a mere 2.5 percent in March 2026 from March 2025, helping bring China’s trade surplus to a 13-month low.

Although all economic statistics from just about every available source commonly show inexplicable month-to-month variations, this sort of huge and sudden change seems likely to be a departure from reality. Exports tend to flow according to contracts that stand for a lot longer than a month. They do not reverse suddenly, as these data imply. The obvious explanation is that reality was neither as strong as the data showed through February nor as weak as the March accounting suggests.

Perhaps this questionable accounting reflects a technical problem, one of data collection or adjustment, or both. If this is the case, then there is reason to question all Chinese economic statistics. There could also be politics at work. Beijing might have wanted the figures to look especially strong as U.S. President Donald Trump’s tariffs and other trade restrictions went into effect in 2025, but then saw a need to moderate the fiction by adjusting back toward reality in March. This kind of manipulation would also give reason to doubt all economic statistics coming out of Beijing.

Some commentators have explained the abrupt turn with reference to the fighting in the Persian Gulf. For example, look here. However, such excuses seem dubious. With the Strait of Hormuz closed—first by Iranian attacks and then by the U.S. blockade—oil supplies have ceased to flow to China and almost everyone else. That would affect Chinese imports, not exports.

Of course, there is the argument that an interruption in fuel supplies would generally suppress trade. While generally reasonable, such an effect would not likely dominate trade in March. Much of China’s March exports, especially those outside Asia, would likely have been at sea before the war started and would have arrived at their destination in March. If the war had this kind of effect, it would show mostly in the April accounting.

Matters may become clearer when the April figures become available, likely in mid-May. But the real issue here is less about exports or any other specifics in China’s economic picture. It is rather how reliable the figures coming out of Beijing are.

For instance, Beijing claims that China’s real gross domestic product grew by 5 percent in 2024 and by just that amount in 2025. It would be mighty strange for an economy to grow at precisely the same rate for two years in a row, while other measures of economic activity, from sources other than Beijing, suggest that the pace was less uniform and likely slower. It is simply hard to believe the figures the Chinese regime provides, but at the same time, it is all that analysts have to go on.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.