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Exports

Chinese Manufacturers Shift Focus to Alternative Markets Amid US Tariffs

Strategic Insights

— 1 min read

Chinese manufacturers are racing to find new buyers as trade tensions with the US threaten their single largest export market. Increased exports to alternative markets, including Europe and south-east Asia, have partially offset a plunge in US-bound shipments. The European Commission is tracking and countering a surge in Chinese imports, citing concerns about subsidised overcapacity. Meanwhile, Zhejiang province, China's second-biggest exporting region, is keen to help its 100,000 manufacturers weather the tariff turmoil. The provincial government is rolling out programs to cultivate new cross-border ecommerce sellers and promoting export goods for local consumption.

Key Takeaways:

  • Chinese exports to Europe in May increased by 12% from a year earlier, with shipments to Germany up 22%.
  • Exports to south-east Asian countries rose 15% from a year earlier.
  • Analysts believe China's manufacturers will be able to make up for lost sales to the US in other markets, ensuring exports remain a pillar of the national economy.
  • The European Commission is tracking a surge in Chinese imports, citing concerns about subsidised overcapacity.
  • Zhejiang province is investing in programs to help manufacturers shift to new markets, including language programs to cultivate new cross-border ecommerce sellers and export credit insurance subsidies.
  • Bearing exports to the US have fallen 25% since 2017, but city streets in Cixi, China's "home of bearings", are still lined with factories.

Statistics:

  • Value of exports to Europe in May: 12% increase from a year earlier
  • Shipments to Germany: 22% increase from a year earlier
  • Exports to south-east Asia: 15% increase from a year earlier
  • Value of exports to the US: declined 25% in 2024 from 2017
  • Number of manufacturers in Zhejiang province: 100,000
  • Annual exports worth of Zhejiang: $550bn (second only to southern Guangdong)
  • Tariff rate on Chinese goods: above 50%
  • Bearing exports to the US: 25% decline since 2017
  • Cross-border ecommerce sellers in Zhejiang: 100,000 being cultivated

Sources:

  • "China's General Administration of Customs"
  • "The Financial Times"

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