"China recently hit an all time high for trade surplus breaking just about every single record but what does that mean?" -- Elias Yuasa, EIGHTH Grade
Chart Provide by Council of Foreign Exchanges China just reached an A.T.H.(All-Time High) for trade surplus in December 2024, breaking every previous record for the country, and world, with China accounting for 10% of 2024’s market in manufactured goods. This is incredible as China is now dominating the competition in almost every market. From cars to solar panels, China is thriving, but what does that mean for China, the world, and you?
Starting with what it means for China; “I think it’s better for them in the short term but there are potential dangers or costs to that over the long run,” says Frank Ravin, former Lead Trade Negotiator to China, under The George H. W. Bush Administration. “Demand tapers,” Ravin continues.
Short term, China’s increase in exports have caused jobs to be created, drawn in money for the country, and much more, all stimulating their economy. However this has also drawn unwanted attention from other countries with many global leaders, like America, putting tariffs on Chinese products, such as cars, according to the New York Times. Tariffs aren’t China’s only problem though, as the country has also begun to over-build factories, and may be becoming too reliant on their exports.
China has become the second biggest economy in the world, according to U.S. Bank, and they now dominate in just about every market, but that may not last forever. “Consumer demand is finite; you can’t grow forever,” remarks Ravin.
However, as of right now China is giving other countries a run for their money as they scramble to compete with China’s low prices and high performance, with countries erecting tariffs left and right to try to slow them down. However, China’s exports to the European Union and Southeast Asia have only grown, according to AP News. China has also now removed tariffs on poorer countries so as to allow them to trade even more.
This doesn’t just affect the globe though; it affects the consumer as well. With China exporting so much stuff for so little money, lots of companies have begun to capitalize on this unique opportunity. Meaning, just about everything you buy and have has been at least partially created and manufactured by China. That means that if the Chinese trade goes down, there’s a good chance that your favorite company is next.
Starting with what it means for China; “I think it’s better for them in the short term but there are potential dangers or costs to that over the long run,” says Frank Ravin, former Lead Trade Negotiator to China, under The George H. W. Bush Administration. “Demand tapers,” Ravin continues.
Short term, China’s increase in exports have caused jobs to be created, drawn in money for the country, and much more, all stimulating their economy. However this has also drawn unwanted attention from other countries with many global leaders, like America, putting tariffs on Chinese products, such as cars, according to the New York Times. Tariffs aren’t China’s only problem though, as the country has also begun to over-build factories, and may be becoming too reliant on their exports.
China has become the second biggest economy in the world, according to U.S. Bank, and they now dominate in just about every market, but that may not last forever. “Consumer demand is finite; you can’t grow forever,” remarks Ravin.
However, as of right now China is giving other countries a run for their money as they scramble to compete with China’s low prices and high performance, with countries erecting tariffs left and right to try to slow them down. However, China’s exports to the European Union and Southeast Asia have only grown, according to AP News. China has also now removed tariffs on poorer countries so as to allow them to trade even more.
This doesn’t just affect the globe though; it affects the consumer as well. With China exporting so much stuff for so little money, lots of companies have begun to capitalize on this unique opportunity. Meaning, just about everything you buy and have has been at least partially created and manufactured by China. That means that if the Chinese trade goes down, there’s a good chance that your favorite company is next.
