China’s Exports to U.S. Plunge 35% Amid Tariff Truce and Port Disruptions

New data reveals that China’s exports to the U.S. fell by a staggering 35% in May, marking the sharpest decline since the COVID-19 pandemic in 2020. This drop occurred despite a temporary truce between the U.S. and China, which saw President Trump lowering tariffs on Chinese goods to 30% from 145%, and China reciprocating by cutting tariffs on U.S. products. However, the truce arrived too late to mitigate severe port disruptions, as the tariffs were only lifted mid-May, by which time significant damage had already been done.
Meanwhile, China reported increased exports to other regions, with shipments to Southeast Asia and the EU rising by 15% and 12%, respectively, and exports to African nations jumping 33%. Experts suggest that some Chinese goods are being transshipped to the U.S. via third countries, such as Thailand and Vietnam, to bypass high tariffs.
Despite a 5.4% GDP growth in the first quarter of 2025, China faces challenges including deflation, cautious consumer spending, and weaker imports, which dropped 3.4% year-over-year. Imports from the U.S. fell 18%, reducing China’s trade surplus with the U.S. by 41.6% to $18 billion.
Trade negotiations between the U.S. and China are set to resume in London, as both sides accuse each other of breaching their temporary agreement. The U.S. alleges that China has not resumed rare earth shipments, while China criticizes U.S. export restrictions on AI chips and visa revocations for Chinese students.

Published: 6/9/2025