Tariffs Tank China's US Exports, but Southeast Asia and India Cash In

Yahoo

09-05-2025

China's exports are bifurcating heavily in the wake of U.S.-levied tariffs that escalated to 145 percent since the start of April.
Shipments of Chinese goods to the U.S. dropped 21 percent throughout the month to $33 billion, according to monthly official customs data from China.
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But total exports out of the country still rose 8.1 percent for the year to $315.7 billion, buoyed heavily by a 20.8 percent increase to the 10 countries comprising the Association of Southeast Asian Nations (ASEAN). These markets include trading partners like Vietnam, Indonesia, Malaysia and Thailand. The ASEAN markets collectively took in $60.4 billion in Chinese goods.
Vietnam imported $17.2 billion from China in April, according to the data, marking a 22.5 percent jump. China's relationship with Vietnam, in particular, has been under U.S. scrutiny as exports to the southeast Asian country accelerate.
This coincides with Vietnam's 34 percent increase in exports to the U.S. during the month, with Washington accusing Chinese companies of using the country as a transshipment hub to move its own goods to the U.S. without paying duties. Vietnam reportedly issued a directive to crack down on illegal transshipments in response.
Another major market picked up the slack left from the U.S.-China decoupling. Chinese exports to India totaled $11.2 billion, a significant boost of 21.7 percent from the year prior.
Additionally, exports to the European Union were up 8.3 percent to $46.7 billion.
Nevertheless, Chinese exports worldwide saw softer growth from the month prior amid the U.S. trade war, with outbound shipments rising 12.4 percent in March.
However, the April results did surpass some expectations of a bigger collapse. Reuters polls estimated that China would see just a 1.9 percent increase in exports worldwide, well off the 8.1 percent total.
'Since the beginning of this year, all regions and departments have worked together to effectively respond to external shocks, promote the continuous recovery of China's economy and continue the steady growth of foreign trade,' Lv Daliang, director of the statistics department at the General Administration of Customs, told state broadcaster CCTV.
The numbers come ahead of the first anticipated meeting between representatives from China and the U.S. since President Donald Trump first launched 'Liberation Day' duties on April 2.
Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are set to meet with Chinese Vice Premier He Lifeng in Switzerland over the weekend in what could be the first round of a potential de-escalation.
On Friday morning, President Trump suggested in a Truth Social post that he was open to lowering the tariff number again.
'80% Tariff on China seems right! Up to Scott B,' he said in the post.
In the month after Liberation Day, both countries retaliated to the 34-percent added tariff imposed by Trump in a back and forth which ended up with China tariffing U.S. imports at a 125-percent rate, and the U.S. settling on 145 percent.
Both countries have tried to blunt some of the economic impact by granting exemptions on select product categories.
And for China, the country unveiled sweeping measures this week to counter the tariffs, including cutting interest rates to bolster economic growth.
Economists at investment bank Nomura estimate that around 2.2 percent of China's gross domestic product is directly affected by tariffs. If exports would halve, that would be China could lose 1.1 percent of its GDP.
'The actual loss will be larger as the shock ripples through to other sectors, especially the services sectors that facilitate merchandise exports,' the bank wrote in a recent research note.
For China, the slowdown in exports followed weeks of reports indicating that cargo on the trans-Pacific trade lane was slowing down both ahead of, and after, the implementation of Trump's tariffs. Apparel companies had cancelled import bookings by as much as 59 percent ahead of the Liberation Day levies.
In the days after, cancellations and postponements had become more commonplace for goods out of China across industries due to the uncertainty over the cost increases. Amazon had reportedly cancelled orders out of China in a move that impacted its first-party vendors, while Five Below asked vendors to suspend products exiting the country.
Maersk estimated Thursday that China-to-U.S. trade volumes had dropped in the range of 30 percent to 40 percent throughout April, following suit from a parallel 30-percent cancellation rated reported by Hapag-Lloyd.
The dip is so drastic for the global trade ecosystem that Maersk revised its global container outlook for the year.
Instead of its prior projection that volumes would increase 4 percent, Maersk now believes it can be anywhere from a 4 percent increase to a contraction of 1 percent—mirroring a similar expectation of a 1 percent global decline from maritime supply chain advisory Drewry.
The decline in Chinese exports is forecast to strain activity at U.S. ports for the foreseeable future. According to the Global Port Tracker from the National Retail Federation and Hackett Associates, imports at major American ports are expected to be down at least 20 percent year over year from June into this fall, and volume for all of 2025 could be down by more than 10 percent.