China's exports surge 23.9% in July, driven by AI and tech shipments amid strong trade growth

Aug 7, 2026

China's exports surged 23.9% year-on-year in July 2026 to $397.85 billion, driven by a global artificial intelligence boom that doubled chip shipments. Imports rose 27.5%, yielding a massive $112.5 billion trade surplus. The export strength comes despite escalating trade tensions, including a new 12.5% U.S. tariff and retaliatory Chinese drone export curbs, helping offset weak domestic consumption and a slowing Chinese economy.

China July export growth

▪China's exports grew 23.9% year-on-year in July 2026 to $397.85 billion, exceeding analysts' expectations but slowing from the 27% growth recorded in June 2026.
▪China's imports rose 27.5% year-on-year in July 2026 to $285.35 billion, slowing from a 36% jump in June 2026.

Integrated circuit shipments surge

▪Exports of mechanical and electrical products, including electric vehicles, lithium batteries, and wind power equipment, accounted for over 60% of China's total shipments in the first seven months of 2026.
▪China's integrated circuit exports by value surged 117% year-on-year in July 2026, nearly doubling in the first seven months of 2026 compared to the same period in 2025.

AI infrastructure demand

▪A global build-out of artificial intelligence infrastructure supported China's economy in 2026, driving overseas shipments of computers and related parts up 45.2% year-on-year in the first seven months.
▪China's export engine remained resilient in July 2026 despite global headwinds, including the US-Israel war on Iran and simmering trade frictions between Beijing and Washington.

U.S. tariff escalation

▪Following U.S. sanctions over forced labor and national security, Beijing announced restrictions on drone exports to the United States and blacklisted six firms on August 5, 2026.
▪China's shipments to the United States rose 17% year-on-year in July 2026, while China's exports to the European Union expanded 16% year-on-year.
▪Chinese exporters accelerated shipments to the United States in July 2026 ahead of a new 12.5% U.S. tariff on Chinese products that replaced a lapsed 10% temporary rate.

Trade surplus imbalance

▪China's trade surplus reached $112.5 billion in July 2026, narrowing from $125.6 billion in June 2026 but exceeding analysts' estimates of approximately $107 billion.
▪Western trading partners, including the United States and the European Union, have pressured Beijing to address its massive trade surplus, which exceeded $1 trillion in 2025.
▪Zhiwei Zhang of Pinpoint Asset Management expects intense trade negotiations between China and its major trading partners ahead of a U.S.-China summit in September 2026 and an EU-China meeting in October 2026.

Domestic consumption weakness

▪Chinese authorities pledged incremental fiscal and monetary support during a late July 2026 policy meeting, but stopped short of announcing concrete steps to boost subdued domestic household spending.
▪China's economy expanded at its weakest pace since late 2022 during the second quarter of 2026, with gross domestic product growing at 4.3% in the April-to-June period.