Over One Trillion in Surplus: The CCP’s Export “Great Leap Forward” — The Higher It Climbs, the Harder It Falls

Shipping containersort in Chinese port . (Video screenshot)

[People News] On December 8, 2025, the General Administration of Customs of the Chinese Communist Party (CCP) announced that China’s trade surplus had, for the first time, surpassed the one-trillion-dollar mark, reaching a cumulative USD 1.08 trillion over the first 11 months, setting a historic record.

December 8 coincided with the CCP’s Politburo meeting to set the economic direction for next year. The political boot-licking significance of the Customs Administration’s announcement far exceeded its actual economic significance. The seemingly dazzling headline number conceals a profound structural economic crisis. Behind the outsized surplus is an export-driven “Great Leap Forward,” in which various non-market means are used to force short-term blowout growth, manufacturing “high-appearance” data that is almost completely disconnected from economic fundamentals. This reflects the CCP economy’s severe imbalance and a governance model characterized by heavy government intervention.

From January to November, China’s trade surplus (calculated in U.S. dollars) grew 21% year-on-year to USD 1.0758 trillion. This surplus is more than 50 times that of 2001, when China joined the WTO. In 2025, the CCP’s exports of goods and services accounted for about 38% of GDP. But the path to achieving this includes layered tactics such as exchange-rate manipulation, export rushing, entrepôt trade, and data padding.

What the CCP is doing is not creating an “export miracle,” but digging itself a “trade trap.” This “beggar-thy-neighbor” export model, which shocks other countries’ industrial chains and domestic industries, is now facing global backlash; overcapacity is aggravating a deflationary spiral; and export dependence will ultimately evolve into the final straw causing economic brittle fracture.

Exposing the CCP’s Export “Great Leap Forward” Playbook:

1. Manipulating the Renminbi Exchange Rate

The RMB exchange rate, a key lever and hidden weapon for China’s export competitiveness, has long been accused of being artificially manipulated to gain unfair advantages. In April 2025, to respond to tariff pressures imposed by the Trump administration, the CCP allowed the RMB to depreciate as a countermeasure. In September 2025, the RMB’s central parity rate against the U.S. dollar once fell below 7.4, with the offshore rate reaching 7.4290, a post-pandemic low; this depreciation directly propelled export growth.

In recent years, the RMB has continued to weaken against many other currencies (especially the euro). Jens Eskelund, president of the European Union Chamber of Commerce in China, said the RMB has depreciated by 30% against the euro, possibly even more. Competition between European and Chinese manufacturers will become extremely difficult, if not impossible.

Sheng Songcheng, former director-general of the People’s Bank of China’s Survey and Statistics Department, who has since retired, delivered a talk on purchasing power parity at a financial conference in late November: “If calculated according to purchasing power parity, it wouldn’t be 1 to 7; it would very likely be 1 to 5 or 1 to 4,” and “Some have calculated that if it were truly according to purchasing power parity, one U.S. dollar would exchange for 3.5 RMB.”

Sheng’s remarks may sound alarmist and somewhat exaggerate the RMB’s purchasing power, but they reveal the CCP’s dilemma: RMB appreciation is unfavorable to exports—almost the only remaining engine of the CCP economy—while depreciation is unfavorable to RMB internationalization. Therefore, the CCP’s RMB strategy is to maintain stability with two-way fluctuations.

On the other hand, because the CCP economy is in deflation, domestic prices have remained weak, while prices in other parts of the world have risen. Over the past five years, producer prices charged by European factories and other enterprises rose by 35%, and by 26% in the United States. This greatly benefits CCP exports. Over the past five years, a weak RMB has driven China’s automobile exports to the EU to increase 16-fold.

2. Rushing Exports Ahead of U.S. Tariff “Gate Drops”

Facing U.S. tariff “gate drops,” Chinese exporters have launched a “rush exports” mode, shipping early to avoid potential losses. In 2024, China’s exports to the United States reached USD 524.656 billion, up 4.9% year-on-year. In December 2024, CCP foreign trade exports sprinted sharply; that month’s export value in U.S. dollars rose 7.6% month-on-month and 10.7% year-on-year, making full-year 2024 exports particularly eye-catching, with growth of 5.9%.

In 2025, after Trump took office and imposed reciprocal tariffs globally, the CCP’s export-rushing effect continued to amplify to avoid the tariff cudgel. Affected by export rushing, in the first half of the year China’s total goods trade imports and exports reached RMB 21.79 trillion, up 2.9% year-on-year. Imports were RMB 8.79 trillion, down 2.7%, while exports were RMB 13 trillion, up 7.2%. Export growth far outpaced imports: exports +7.2% versus imports −2.7%. The trade surplus expanded, and the data show a strong export-rushing effect.

3. CCP Entrepôt Trade and Origin Washing to Challenge U.S. Tariffs

Entrepôt trade has become a “gray channel” to evade tariffs. This is reflected in changes in China’s export destination structure this year.

Since April 2025, China’s exports to the United States have declined, while exports to non-U.S. regions have risen overall. From April to August 2025, China’s exports to the U.S. were down 25.4% year-on-year, while exports to the EU, ASEAN, Japan, Latin America, and Africa were up 9.5%, 18.3%, 6.0%, 4.0%, and 32.2%, respectively.

From April to July 2025, U.S. imports from China were down 35.6% year-on-year, while imports from the EU, ASEAN, Japan, Mexico, and Africa were −1.3%, 30.7%, 0.0%, 4.3%, and 6.5%, respectively.

China’s exports to ASEAN and U.S. imports from ASEAN both rose rapidly. In terms of contribution to overall growth, from April to August 2025, China’s exports to the U.S. and ASEAN contributed −3.8 and +3.0 percentage points, respectively, to overall exports; from April to July 2025, U.S. imports from China and ASEAN contributed −4.6 and +3.3 percentage points, respectively, to overall imports. Clearly, China’s entrepôt trade to the U.S. via ASEAN is a major factor behind this.

Notably, the CCP’s exports to Africa surged this year. In the first eight months, the trade surplus with Africa reached USD 60 billion, nearly exceeding last year’s total. Exports to Africa mainly include electric vehicles, solar panels, batteries, smartphones, and industrial equipment such as motors and generators. The CCP’s capture of African markets relies primarily on price suppression. Through the Belt and Road Initiative, the CCP creates debt traps in Africa, devours natural resources and labor markets, raising deep concerns among African people; now it is flooding African markets with large volumes of cheap manufactured goods, severely damaging the growth of local African industries.

4. Local Officials Manufacturing Massive “Invoice Exports” for Opening-Quarter Numbers

Data padding is a CCP specialty, at both central and local levels. In 2025, the National Bureau of Statistics announced that seven provinces, including Jiangsu and Zhejiang, had engaged in statistical fraud involving concealment and inflation. GDP data fraud, population data fraud, and social security data fraud are commonplace in China and are directly government-led.

The CCP uses local and export data as performance metrics for evaluating officials. Moreover, export data rely solely on customs reporting, and to encourage exports, the government provides subsidies. Officials need performance results; enterprises want subsidies; customs provide data without tracing data origins. This creates fertile ground for generating foreign-trade export data through “invoice exports.”

According to mainland media reports, early this year a major foreign-trade subsidy fraud case went to trial in Wuhan, revealing just the tip of the iceberg of export data falsification. Real export data from numerous small and medium-sized enterprises in coastal regions were collected by intermediaries and resold to shell companies in inland regions. These shell companies then used the data to apply for export subsidies from local governments. Some local commerce departments even became key links in this chain; when localities needed “opening-quarter” numbers, they would even hint that enterprises should increase data purchases. The report noted that the sole criterion for determining whether enterprises qualified for subsidies was customs export data issued by higher-level commerce departments. This data fraud became a multi-party win-win business, and such data are widespread nationwide.

Beggar-Thy-Neighbor Will Invite Countermeasures

The Wall Street Journal reported that China is swallowing an ever-larger share of the global manufactured goods market. This reveals an unsettling truth: Beijing is pursuing a “beggar-thy-neighbor” growth model at the expense of all other countries.

The article notes that Goldman Sachs expects China’s economic growth rate to be about 0.6 percentage points faster per year in coming years, but this would reduce growth in the rest of the world by 0.1 percentage points annually. Goldman estimates that by 2029, China’s current-account surplus (the broadest trade definition) will reach 1% of global GDP, a proportion that would be the highest among all countries since at least the late 1940s.

Lianhe Zaobao reported that China’s trade surplus with the EU this year is approaching a record high of USD 300 billion. The imbalance in China-EU trade has been viewed by European leaders as a matter of life and death for European industry and may trigger the EU’s largest rethinking of China policy in at least a decade; trade conflicts could erupt at any moment.

Data from France’s Ministry of Finance show that last year France’s goods trade deficit with China reached as high as EUR 47 billion. After returning to Europe from Beijing, French President Emmanuel Macron told France’s economic daily Les Échos: “If they (the Chinese side) do not take action, in the coming months Europe will be forced to take strong measures and decouple from China, like the United States, such as imposing tariffs on Chinese goods.”

Mexico is also a victim of CCP export trade. Mexico has become an origin-washing hub for Chinese automobiles transshipped to the United States. This year, Mexico sold more than 500,000 new energy vehicles from China. On December 10, the Mexican Senate approved a bill to impose tariffs of up to 50% on automobiles, steel, and other goods from China and other Asian countries that do not have trade agreements with Mexico.

The CCP’s global export dominance brings the world not trade balance and reciprocity, but trade conflict and tension—something countries worldwide cannot endure. IMF Managing Director Kristalina Georgieva, speaking of China’s USD 19 trillion-scale economy, said: “China is too large to rely on exports to further drive growth; continued reliance on exports may intensify global trade tensions.”

The CCP’s export-dependence orientation exacerbates economic brittleness. Domestic consumption accounts for only 38% of GDP; investment has declined under the drag of a collapsing real estate sector. Local government debt has reached RMB 140 trillion, completely overshadowing a full year’s GDP. Meanwhile, unemployment has remained high for a long time, and massive monetary and fiscal easing by the central bank and the Ministry of Finance has failed to raise investment and consumption willingness among enterprises and households.

The CCP touts a trillion-dollar surplus as a milestone of economic development, unaware that it has saved face but lost substance. The higher it climbs, the harder it falls; after the export “Great Leap Forward,” an economic hard landing and a painful fall are inevitable.

(People News, first publication) △