China’s July trade surge driven by AI-related hardware and resilient exports

China recorded a robust increase in exports and imports in July, propelled by global demand for AI hardware and electronics, with trade surplus nearing last year’s high amid ongoing geopolitical tensions.

China’s trade data for July showed another month of strong external demand, with exports and imports both rising sharply as the country’s manufacturers continued to benefit from the global build-out of artificial intelligence infrastructure. Official figures released on Friday by the General Administration of Customs showed exports up 23.9% from a year earlier, slightly ahead of market expectations, while imports rose 27.5%, underscoring how trade has become a crucial support for the economy even as domestic demand remains subdued. AP reported that high-tech goods, including electronics and electric vehicles, remained a key driver of the export strength.

The latest numbers also suggest that China’s trade surplus remains on track to approach last year’s record level. Through the end of July, the gap had reached $687 billion, according to the customs data, after the country posted a historic surplus of nearly $1.2 trillion in 2025. That scale has fuelled concern in Europe, where policymakers and manufacturers have argued that a flood of Chinese goods is putting pressure on local industry. Chinese authorities, however, have continued to reject accusations that they seek an intentional surplus, even as the ruling Politburo has called for a more balanced trade pattern.

A notable feature of this year’s export performance has been the surge in shipments linked to artificial intelligence. Customs data showed that overseas sales of computers and related parts jumped 45.2% in the first seven months of the year, reflecting what analysts see as robust demand for data-processing equipment, chips and related components. AP said the strength in electronics and electric vehicles has been reinforced by the global rush to build AI capacity, which is lifting demand for Chinese hardware across several supply chains.

Imports, meanwhile, have also remained resilient despite soft consumer demand at home. The July increase was slower than June’s pace but still exceeded forecasts, and analysts noted that higher global oil prices, driven in part by tensions in the Middle East, likely supported the figure. China’s trade with the United States also remained robust despite ongoing tensions, with shipments to the US rising 17% in July and the bilateral surplus for the year approaching $171 billion, according to the official figures.

The trade picture has shifted sharply from two years ago, when exports and imports were falling and factory activity was under pressure. In July 2023, exports dropped 14.5% year on year and imports fell 12.4%, according to data cited by China Briefing and Reuters coverage, reflecting a broad slump in external demand. By contrast, the latest figures point to a much stronger export cycle, helped not only by AI-related demand but also by broader gains in green technology and electronics, even as friction with Washington and concern in Europe continue to shadow China’s trade expansion.