Amid the global economic recovery and escalating trade tensions, China's exports have remained a focal point of international attention. In recent years, the country's total exports have risen from 17.24 trillion yuan ($2.41 trillion) in 2019 to 23.77 trillion yuan recently. This period has also seen a clear trend of diversification in both export destinations and products.

Lujiazui, the financial center in Shanghai, forms a perfect backdrop to the Bund area. [Photo by Wang Gang/For China Daily]

Export growth

In 2016, China's exports to the United States were valued at 2.54 trillion yuan. Despite trade frictions initiated by then-president Donald Trump in 2018, US-bound exports had risen to 3.87 trillion yuan by 2022. In 2023, this figure slightly decreased to 3.52 trillion yuan, but it still represented an over 1.3-fold increase from 2016. From January to May 2024, China's exports to the US stood at 1.39 trillion yuan, a 3.6 percent increase year-on-year.

Amid rising inflation in the US, cost-efficient Chinese products have helped US households reduce living costs and enhance their purchasing power, particularly benefiting middle- and lower-income groups. These benefits have driven the overall increase in China's exports to the US.

Simultaneously, exports to markets involved in the Association of Southeast Asian Nations, Mexico, Central Asia and Arab nations have shown robust growth. ASEAN is now the largest trading partner of China, with China's exports reaching 3.71 trillion yuan in 2023, maintaining the high level seen in the previous year. The country's exports to Central Asia totaled 436.71 billion yuan in the same year, up 53.77 percent year-on-year. Exports to Arab countries amounted to 1.28 trillion yuan last year, an 11.72 percent increase year-on-year. Notably, exports to the United Arab Emirates and Saudi Arabia increased by 9.78 percent and 19.9 percent, respectively, year-on-year in 2023.

From January to May this year, exports to these regions continued to rise. Exports to ASEAN totaled 1.68 trillion yuan, up 13.5 percent year-on-year, with notable increases to Laos, Vietnam, Cambodia and Indonesia. Exports to Central Asia amounted to 179.22 billion yuan, up 20.36 percent year-on-year. Exports to Arab countries amounted to 581.93 billion yuan, a year-on-year increase of 14.79 percent, with exports to the UAE growing by 18.82 percent and to Saudi Arabia by 15.28 percent.

Green Evolution

With the diversification of export destinations, China's range of products sold overseas has significantly broadened. A few years ago, exports were dominated by clothing, furniture, and home appliances. However, by 2023, electric passenger vehicles, lithium-ion batteries, and solar panels had emerged as the fastest-growing export goods, totaling 1.06 trillion yuan—a 29.9 percent increase. The surge in green energy-related products not only boosts trade with various regions but also supports the global transition toward green and low-carbon production.

Private and foreign-invested enterprises are pivotal to China's export growth. In 2023, the number of foreign trade operators with first-time import and export records surpassed 600,000, including 556,000 private enterprises. Private enterprises contributed 14.74 trillion yuan in exports, accounting for 62 percent of the total export value for the year. Foreign enterprises exported 6.78 trillion yuan, representing 28.5 percent of the national total. Additionally, the establishment of 21,764 new foreign-invested enterprises marked a 17.4 percent year-on-year increase in their numbers.

As China adjusts its export structure, many foreign firms are realigning their investment strategies within the country. Production lines are shifting away from traditional products like mobile phones, computers, and home appliances to high-tech products such as new displays and high-performance batteries. Notably, foreign firms are increasingly investing in research and development.

For instance, BMW Group announced a 20-billion-yuan investment plan for new energy vehicle production at its base in Shenyang, Liaoning province, last year. Similarly, AstraZeneca, a multinational biopharmaceutical company, invested $475 million in a new drug plant in Wuxi, Jiangsu province. From January to May 2024, the manufacturing sector attracted 117.1 billion yuan in foreign investment, with high-tech manufacturing accounting for 50.41 billion yuan. The share of high-tech manufacturing in total investment rose by 2.7 percentage points compared to the previous year. These developments reflect China's robust industrial and supply chains in emerging fields, such as new energy vehicles, and highlight the overall upgrade in the country's industrial structure.

Market Expansion

Amid a complex global economic and political landscape, Chinese companies are increasingly expanding their investments worldwide to access broader markets. In 2022, China's total outbound direct investment across all industries neared 985.37 billion yuan. By 2023, this figure surpassed 1 trillion yuan, reflecting a 5.7 percent year-on-year increase, with a significant focus on Southeast Asia, Africa, and Latin America. These investments have played a crucial role in driving local economic development and creating jobs. From January to May, China's total industrial investment abroad reached 497.85 billion yuan, up 13.20 percent year-on-year.

Chinese companies are evolving into multinational corporations, actively participating in global supply chains and integrating with global resources such as raw materials and components. By introducing technology and innovation to other countries, Chinese companies have contributed to the upgrading of local industries and the enhancement of efficiency.

The growth of China's exports is both a response to, and a potential solution for, major global challenges, including high inflation, poverty, and global warming. 

In the wake of the COVID-19 pandemic, poverty rates have risen in some developing countries. According to the 2023 Global Multidimensional Poverty Index report by the United Nations Development Programme, approximately 1 billion people worldwide live in acute multidimensional poverty, with half of them being children. Since 2020, the extreme poverty rate has increased for the first time since 1998. To improve the living standards of impoverished populations, more cost-efficient products are urgently needed.

Meanwhile, global warming is accelerating, with 2023 registering the highest global average temperature since records began in 1850. Extreme weather events, such as heavy rains, hurricanes, and hail, are becoming more frequent. Addressing these challenges requires the establishment of an integrated trade system. Such a system would facilitate efficient resource integration, benefit disadvantaged populations, and promote green, low-carbon development.

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