China Exports Jump 21.8% as Trump Tariffs Lose Bite

China’s exports surged 21.8 percent in January and February, hitting $656.58 billion and marking the fastest pace in four years, according to customs data released Tuesday. The jump nearly tripled the 7-8 percent growth forecast by economists and came despite an 11 percent drop in shipments to the United States after President Donald Trump imposed new tariffs. Beijing combines the first two months to smooth out Lunar New Year distortions, but Macquarie Group chief China economist Larry Hu said holiday timing “could not fully account” for the strength.

European Union orders rose 27.8 percent, while exports to the 10-nation ASEAN bloc—including Thailand, Singapore and the Philippines—climbed almost 30 percent. Electronics led the charge, with AI-related hardware shipments accelerating as global tech investment booms. Agricultural and manufactured goods also contributed to the gains, customs officials said.

Bloomberg interviews with workers in Guangdong and Jiangsu reveal wages falling and permanent jobs being replaced by temporary contracts even as export revenues set records. One Shenzhen electronics assembler, 42-year-old Lin Mei, saw her monthly pay cut 12 percent to 4,200 yuan ($580) despite overtime quotas rising. Plant owners are automating faster to stay competitive, leaving surplus labor with shrinking paychecks.

At a UN drug meeting in Vienna Monday, White House drug-policy director Sara Carter accused China of allowing “millions of tonnes” of fentanyl precursors to reach cartels through “weak export controls.” China called the claim false and labeled US policies “irresponsible.” The spat looms over Trump’s planned visit to meet Xi Jinping later this month under a South Korea-brokered deal that trades tariff relief for Beijing’s promise to curb precursor sales and keep rare-earth exports flowing. The US Supreme Court last month struck down a separate 10 percent fentanyl-linked emergency tariff Trump had imposed.

The trade boom gives Xi room to argue that China can hit its lowered 2026 growth target of 4.5-5 percent even as domestic consumption stays weak and property developers default. Last year the economy met its 5 percent goal only because exports offset slumping home sales. State media are already citing the 21.8 percent jump as proof that “external circulation” can compensate for a shaky property market and a population that is shrinking for the third straight year.