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China’s export growth could weaken or even contract next year due to Donald Trump’s tariffs, economists warn, as the incoming U.S. administration threatens to undermine a key source of expansion for Beijing.
From January to November, China’s exports rose about 5.4% annually in U.S. dollar terms to $3.2 trillion, boosting overall GDP growth as authorities work to restore confidence amid a long-term slowdown in the real estate industry.
But economists generally expect economic growth to slow in 2025 due to the tariffs, which many say will increase the need for Beijing to step up support for the economy.
Robin Xing, chief China economist at Morgan Stanley, said exports “are an important part of economic growth in 2024.” “I think the contribution will definitely shrink.”
Trump promised last month to raise tariffs on Chinese goods by 10% (previously threatening a 60% increase), but no formal decision has been made before he takes office in January.
While forecasts of its potential impact vary, Goldman Sachs expects Chinese exports to fall 0.9% in dollar terms next year. Capital Economics also forecast an outright decline in exports, while UBS and Nomura predicted zero export growth.
Other banks such as Morgan Stanley and ING show exports still growing, but at a much slower pace than 2024.
A survey of economists released last week by the research company FocusEconomics estimated that China’s merchandise exports will grow by only 2% in 2025, significantly lower than the 3.9% growth forecast a month ago.
The slowdown in export growth will come at a critical moment for the Chinese economy. President Xi Jinping turned the focus to domestic demand at the annual Central Economic Work Conference last week, signaling renewed urgency to boost growth.
Economic data on Monday showed unexpectedly weak retail sales, adding to pressure on policymakers. Beijing had introduced measures to support stock market prices in late September and launched a local government refinancing plan last month.
Morgan Stanley’s Xing warned that slowing export growth “will make China’s deflation problem more serious.”
A spokesman for the National Bureau of Statistics said on Monday that the external environment had become “more complex”.
Lu Ting, chief China economist at Nomura Securities, said tariffs may start to affect China’s exports from mid-2025, and expected early shipments in the fourth quarter will also drag down economic growth. Without barriers such as tariffs, he expects export growth to be 4-5%.
Julian Evans-Pritchard, head of China economics at Capital Economics, said large-scale tariffs would not be introduced until the second quarter. He said exports would remain “healthy” until then, but expected a sharp decline of 3.5% in 2026.
Beijing is under pressure to meet an official annual economic growth target of around 5%, and Xi Jinping said this month that he was “fully confident” in achieving that target.
Goldman Sachs estimates that exports will eventually contribute nearly three-quarters of overall GDP growth by 2024, which they predict is 4.9%. They expect this figure to fall to 4.5% next year due to slower export growth.
Economists estimated export and GDP growth based on a range of tariff scenarios. For example, Barclays predicts that trade tensions will hit GDP by 0.8-1 percentage points, assuming tariffs of 30%.
Macquarie said that under a 60% tariff, China’s total exports would fall by 8%, GDP would fall by 2 percentage points, and Beijing would have “no choice but to escalate stimulus measures.”
But Macquarie’s chief China economist Larry Hu said forecasting exports was “almost impossible” given the uncertainty about “the size, timing and implementation of tariffs”.
Additional reporting by Gao Haoxiang in Hong Kong
