China's trade surplus with the rest of the world surpassed $1 trillion for the first time in history, customs data released Monday showed, a milestone that arrived despite President Donald Trump's tariffs slashing American purchases of Chinese goods by nearly a third.

The figures reveal a stark reality: Trump's trade war has not dented China's overall export machine. Chinese manufacturers have simply found other customers.

For the first 11 months of 2025, China recorded a trade surplus of $1.076 trillion, already exceeding the $990 billion surplus logged for all of 2024. Overall exports rose 5.4% compared to the same period last year. Imports fell slightly.

"Put simply, China's price competitiveness is extremely strong," said Xu Tianchen, a senior economist at the Economist Intelligence Unit in Beijing. "The main reason behind the continued growth of China's exports is not because the overall size of global trade has expanded, but because China is claiming a larger share of the existing trade landscape."

Exports to America plunge while others soar

Chinese exports to the United States dropped 28.6% in November compared to the same month last year. That marked the eighth consecutive month of double-digit declines.

The collapse in US-bound shipments came even after Trump and Chinese leader Xi Jinping reached a trade truce at a late October meeting in South Korea. Under that agreement, the US lowered some tariffs on China while Beijing promised to halt export controls on rare earth minerals and resume purchasing American soybeans.

Average US tariffs on Chinese goods still stand at 47.5%. Economists say the 40% threshold is roughly where Chinese exporters begin losing their profit margins.

But China made up the lost American business elsewhere.

Exports to the European Union jumped 14.8% in November year-on-year. Shipments to Australia surged 35.8%. Sales to Southeast Asia climbed 8.2%. Latin America and Africa absorbed more Chinese goods as well.

"The tariff cuts agreed under the US-China trade truce didn't help to lift shipments to the US last month, but overall export growth rebounded nonetheless," said Zichun Huang, China economist at Capital Economics. "We expect China's exports will remain resilient, with the country continuing to gain global market share next year."

November exports totaled $330.3 billion worldwide, up 5.9% from a year earlier. That beat economists' forecasts and reversed an unexpected 1.1% contraction in October.

Europe grows worried

The shift in Chinese trade flows is setting off alarms in Brussels.

China's trade surplus with the EU reached $266.8 billion through November, up nearly 20% from the same period last year. Last year, China sold more than 300 billion euros worth of goods to the EU beyond what it purchased.

French President Emmanuel Macron, returning from a state visit to China last week, threatened to impose tariffs if Beijing did not act to reduce the imbalance.

"I told them that if they don't react, we Europeans will be forced to take strong measures in the coming months," Macron told Les Echos, the French business newspaper, in an interview published Sunday. He said tariffs could be modeled after those imposed by the United States.

European Trade Commissioner Maros Sefcovic has warned that China's rise "must not come at the expense of the European economy."

One number in Monday's data will particularly concern Germany, where automobile manufacturing accounts for roughly 5% of gross domestic product: Chinese car exports worldwide jumped 53% in November. That followed a 34% increase in October.

Transshipment through Southeast Asia

Part of China's export resilience appears to stem from a practice called transshipment—routing goods through third countries before they reach American shores.

Chinese exports to Southeast Asia have grown strongly this year. Economists say a significant portion of those shipments likely end up in the United States after assembly or repackaging in countries like Vietnam, allowing the goods to avoid US tariffs on Chinese products.

"A large part of that is likely products that were ultimately destined for the US, but now make a stop in Southeast Asia," Xu said.

The Trump administration has attempted to crack down on the practice. The latest data suggests those efforts have not succeeded in closing the loophole.

Domestic demand still weak

While China's export engine hums along, its home market remains sluggish. Imports rose just 1.9% in November, missing economist forecasts of 3% growth.

A prolonged property downturn continues to weigh on consumer spending and business investment. Imports of unwrought copper, a key material in construction and manufacturing, declined.

China's factory activity contracted for an eighth consecutive month in November, according to an official survey. New export orders, while improved, remained in contraction territory.

"China's pivot to establishing domestic demand as a key driver of growth will take time, but it's essential for China to move into the next phase in its economic development," said Lynn Song, ING Bank's chief economist for Greater China. "Ultimately, we need to see what concrete measures are put in place to boost domestic consumption next year."

The ruling Chinese Communist Party's Politburo met Monday under Xi's leadership to discuss economic plans for 2026. State news agency Xinhua reported that leaders reiterated a focus on "pursuing progress while ensuring stability" and acknowledged the need to coordinate domestic economic work in the face of global "trade struggles."

Outlook remains uncertain

A stable global trade environment is unlikely to persist, analysts said.

"US-China relations remain in a stalemate despite their temporary trade truce," said Chi Lo, global market strategist at BNP Paribas Asset Management. "Trade diversification will remain a long-term strategy for China to fight the trade war and manage external exigencies."

Both Trump and Xi have signaled willingness to meet again. Trump has said he would likely travel to Beijing in April. Xi has indicated he may visit the United States early next year. Both sides are aiming to have a more permanent trade agreement ready by then.

Still, some economists believe China will continue gaining ground in global markets regardless of what happens with the United States.

Morgan Stanley predicts China's share of global exports will reach 16.5% by 2030, up from about 15% currently. The firm attributes the expected gains to China's edge in advanced manufacturing and high-growth sectors like electric vehicles, robotics and batteries.

"Despite persistent trade tensions, continued protectionism, and G20 economies taking up active industrial policies, we believe China will gain more share in the global goods export market," said Chetan Ahya, Morgan Stanley's chief Asia economist.

The US trade deficit with China, meanwhile, has contracted. Through November, it stood at $185.2 billion—down roughly 21% from the previous year.