China’s surplus is recycled mainly through portfolio investment, cross-border banking flows and Hong Kong capital markets.
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China is transforming its economy with a trade surplus. Photo documentation of the Works
China’s export engine is still extremely strong. The country ended 2025 with the largest trade surplus in history – $1.2 trillion (thousand billion) – underscoring its enduring industrial competitiveness. But that money is not going where it has gone in the past. Of course, the $1.2 trillion figure derived from customs data is somewhat misleading. The balance of payments – which records transactions between a country’s residents and non-residents – shows a slightly smaller surplus of around $1.1 trillion. There is even less money available for reuse. While China boasts a huge surplus in goods trade, it has a huge deficit in services – $238 billion in 2025, including nearly $199 billion in outbound tourism spending. China has…
