Against the backdrop of the United States’ volatile tariff policies, regional integration is set to accelerate.
       China’s latest trade figures have exceeded market expectations. Customs data show that in the first seven months of 2025 the country’s goods trade totaled RMB 25.7 trillion, up 3.5 % year-on-year. Exports rose 7.3 %, while imports fell 1.6 %—a decline that narrowed by 1.1 percentage points compared with the first half of the year.

       In July alone, both total trade and exports grew 6.7 % and 8 % respectively, and imports expanded 4.8 %—the second consecutive month of import growth.

  Global export rush heats up  

       As the United States keeps brandishing tariff threats at India and other nations, China’s better-than-expected export performance has drawn global attention. A surge of “front-loading” and “re-exporting” is seen as one of the key drivers behind July’s faster export growth.

       In July, China’s exports to the United States fell 21.7 % year-on-year, a widening of 5.5 percentage points from June. This dragged the headline export growth down by 3.3 percentage points. After the late-May and June rush to ship before punitive duties of up to 145 % took effect, backlogged orders were largely cleared; new orders are now being held back by still-high U.S. tariffs and extreme uncertainty, prompting many buyers and exporters to wait and see.

       China is hardly alone in racing to ship goods. Feng Lin, Executive Director of Macroeconomic Research at Oriental Jincheng, points out that “front-loading” is heating up worldwide. Korea’s July exports accelerated and Vietnam’s remained buoyant—both driven by the same impulse. As the world’s largest merchandise trader, China is following suit. Under the shadow of elevated U.S. tariffs, trade diversion has become pronounced.

       U.S.-dollar figures show that in July China’s exports to the EU, Korea and Taiwan of China grew 9.2 %, 4.6 % and 19.2 % respectively, speeding up by 1.7, 11.3 and 15.8 percentage points versus June. Shipments to ASEAN stayed at a robust 16.6 %, edging down just 0.3 percentage point. These gains largely offset the deeper drop in U.S.-bound exports, keeping overall export growth elevated.

       The stronger performance reflects both China’s diversified market strategy—much of the output is now absorbed locally—and Chinese firms’ accelerating “going-out” drive that deepens global production and trade networks.

       Lu Daliang, Director-General of Customs Statistics and Analysis, noted that in RMB terms, trade with ASEAN, the EU, Africa and Central Asia rose 9.4 %, 3.9 %, 17.2 % and 16.3 % respectively in the first seven months. Trade with ASEAN and the EU together accounts for nearly 30 % of China’s total, while combined trade with Belt and Road partner countries grew 5.5 %.

       In the first seven months—again in U.S. dollars—exports to the U.S. fell 12.6 %, yet exports to ASEAN, China’s largest trading partner, climbed 13.5 %. Deliveries to Vietnam, Thailand and Indonesia were up 20.7 %, 22.6 % and 14.9 % respectively. Shipments to India rose 13.4 %, to Africa 24.5 %, and to Belt and Road countries 10.4 %.

       Feng Lin argues that the acceleration in exports to Belt and Road economies—now roughly half of China’s total exports—demonstrates how years of steady groundwork in BRI cooperation are providing a crucial buffer against external shocks.

       Starting 7 August, the United States will officially impose “reciprocal” tariffs of 10 %–41 % on numerous countries and regions, plus a 40 % penalty on any goods found to have been transshipped through third locations.

       An executive at an international freight forwarder said his firm had halted all Vietnam re-export operations once Washington’s tariff offensive began, because Vietnamese authorities now scrutinize transshipments strictly. More Chinese companies are instead waiting for clarity after the transition period and, more importantly, are laying out longer-term capacity plans: “produce in Vietnam for global markets, not just for simple repackaging to circumvent tariffs.”

  Industrial-chain collaboration and upgrading  

       Deepening international industrial-chain collaboration is evident in both the structure of China’s trade and the export performance of different product categories. Customs data show that in the first seven months of 2025, general trade rose 2.1 % and accounted for 64 % of total foreign trade; exports within this segment grew 7.4 % while imports fell 5.4 %. Over the same period, processing trade expanded 6.3 % and represented 17.9 % of the total, with exports up 3.8 % and imports up 10.5 %. Imports and exports under bonded logistics rose 6 % overall, exports by 14.1 % and imports by 1 %.

     “The process of regional integration will accelerate further,” notes Wang Jia, assistant researcher at the Institute of Economics, Shanghai Academy of Social Sciences. Confronted with the United States’ country-specific tariff policy, future rules of origin will become stricter, making deeper regional cooperation an effective way for non-U.S. economies—including China—to counter Washington’s tariff volatility.

       Take labor-intensive textiles and apparel: as orders for garment assembly gradually shift to Southeast Asia, China retains a highly concentrated cluster of upstream industries—textile machinery, yarns, fabrics and other intermediates that embody higher technology. Meanwhile, high-value-added electromechanical and high-tech products continue to grow rapidly, demonstrating resilience amid headwinds.

       In U.S.-dollar terms, January-July 2025 textile and apparel exports edged up 0.6 % overall, with textiles rising 1.6 % and apparel slipping 0.3 %. By contrast, China’s electromechanical exports grew 8.1 %, led by integrated circuits (+20.5 %), ships (+15.5 %), LCD panels (+8.0 %) and medical devices (+6.8 %); high-tech product exports rose 6.0 %.

       Wang argues that as China diversifies its export markets, the destinations of its industrial capacity will also become more varied. Under the RCEP framework, cooperation with ASEAN, Japan and South Korea must deepen to strengthen intra-regional supply-chain integration. Both end-product markets and production footprints should reduce dependence on any single country or region. At the same time, China’s domestic industrial structure must keep upgrading—moving faster toward high-end, digital and green manufacturing. “High-value-added, innovative products can sidestep price competition and blunt the impact of high tariffs.”

       Feng Lin expects China’s export growth to slow in August; later, as the shock of U.S. tariffs reverberates through the global economy, exports could slip into negative territory. This suggests that counter-cyclical and trade-stabilizing policies will be stepped up in Q4, including targeted financial support for hard-hit exporters.

       Wang Lingjun, Deputy Director-General of the General Administration of Customs, emphasized that despite external uncertainties, China’s diversified and stable markets, innovative and high-quality products, and adaptive exporters give the country “the confidence and capability to meet all risks and challenges and achieve the annual foreign-trade targets.”

       For firms, the deeper impact comes less from tariffs themselves than from the global economic slowdown and heightened uncertainty, which are already eroding overall demand. In its latest World Economic Outlook update, the IMF slightly raised growth forecasts for this year and next, citing front-loading by importers ahead of threatened U.S. tariffs. Current global activity is therefore distorted by the anticipation of steep duties. Policy uncertainty will remain a threat to world stability in 2025–26.

       The IMF warns that elevated trade-policy uncertainty, rising geopolitical tensions and mounting fiscal vulnerabilities are key downside risks. Economies should reduce uncertainty by building clear, transparent trade frameworks and must cooperate pragmatically to lower trade and investment barriers.