Commentary: China’s US$1.2 trillion commerce surplus is an indication of threat, not energy | USAEMALL.com

WHAT CHINA SELLS TO OR BUYS FROM THE WORLD

For ASEAN, China’s surplus presents both opportunity and warning. Southeast Asia has benefited from supply-chain diversification, rising investment and export growth as firms adopt “China-plus-one” strategies. 

But trade balances tell a more complex story. Much of ASEAN’s export growth depends on imported Chinese inputs, limiting domestic value capture and widening deficits with China.

The winners in this environment will be economies that use Chinese investment and trade links to climb the value chain – by building local supplier networks, skills and domestic demand rather than remaining assembly platforms vulnerable to geopolitical shifts.

For investors, the implications are clear. China’s manufacturing competitiveness is not disappearing, and its ability to adapt should not be underestimated. But political tolerance for chronic surpluses is eroding, and future trade friction will increasingly target structures, not just volumes. 

Meanwhile, any serious move by Beijing to strengthen domestic consumption or allow greater currency flexibility would mark a meaningful inflection point for global markets.

China’s US$1.2 trillion trade surplus is a testament to resilience under pressure. But that alone does not resolve its underlying problems. Avoiding restrictions can sustain growth for a time; it cannot anchor leadership indefinitely. 

The next phase of China’s economic story will be defined not by how much it sells to the world, but by whether it is prepared to buy.

Diana Choyleva is the founder and chief economist of Enodo Economics and a senior fellow at the Asia Society Policy Institute’s Center for China Analysis.