German Media: AI (Artificial Intelligence) Boom Drives Up China's Imports and Exports, Leading to a Clear Trade Surplus for Germany

In June, China's foreign trade volume saw strong growth, with exports to Germany increasing significantly. However, imports from Germany rose only slightly, revealing a clear imbalance.

In June, China's exports to Germany continued to rise sharply. According to data from China's customs authorities, exports to Germany increased by 27.2% year-on-year in dollar terms. In contrast, imports from Germany grew by only 3.1%.

Looking at the first half of this year overall, China's exports to Germany clearly exceeded its imports: exports rose by 19% year-on-year, while imports increased by just 1.8%. In the first half of the year, the total value of China’s goods exports to Germany reached $67.5 billion (approximately €59.3 billion), compared to $45.2 billion in imports. As a result, Germany recorded a trade deficit of $22.3 billion with China.

Changing Trade Landscape Between Germany and China

In the past, Germany had long benefited from China’s economic rise, exporting cars, machinery, and specialized technologies to China. Today, this relationship has shifted. Chinese enterprises now supply products worldwide at low prices and with considerable technological sophistication. This trend has sparked political debate in Germany and across Europe about how to respond to increasingly fierce competition from East Asia.

The automotive and machinery manufacturing sectors face particularly intense pressure. Chinese manufacturers have gained market share in electric vehicles and are producing machinery with steadily improving technical standards. Meanwhile, Germany relies heavily on China for batteries and precursor materials for pharmaceuticals.

Competition is likely to intensify further. China is making targeted investments in future-oriented industries such as semiconductors, robotics, quantum technology, hydrogen energy utilization, and biotechnology—many of which are also focal points of Germany’s high-tech policy.

Strong Overall Foreign Trade Data from China: Semiconductors Drive Export and Import Growth

In June, China’s overall trade volume also surged strongly. Exports to all countries rose by 27% year-on-year, while imports climbed by 36%. Exports to the EU increased by 18.5%, while imports rose by only 9.2%. In trade with the United States, Chinese exports grew by 13.9%, and imports increased by 25.9%. Notably, trade volumes with Russia and Southeast Asian ASEAN countries saw especially strong growth: exports to these two regions rose by 38% and 34.6%, respectively.

Julian Evans-Pritchard from Capital Economics analyzed: "China’s trade figures jumped again in June—largely reflecting recent sharp increases in semiconductor prices driven by the current artificial intelligence boom."

China’s semiconductor exports more than doubled year-on-year, and exports of data processing equipment increased by 53.1% compared to the same period last year.

However, Evans-Pritchard noted that this surge was "entirely due to price increases, specifically the ongoing shortage of memory chips." He pointed out that actual physical quantities exported in June actually declined year-on-year.

Similarly, "the spike in semiconductor prices also inflated import values"—a phenomenon that does not reflect an increase in domestic demand within China.

Analysis: Tensions in China’s Trade Relations with Partners

In the automotive sector, China’s exports rose by 69.6% year-on-year. Evans-Pritchard explained this reflects strong global demand for Chinese electric vehicles.

Zhang Zhiwei from Baoyin Investment believes that June’s data demonstrates the competitiveness and resilience of China’s manufacturing sector. "At the same time, it adds further pressure to trade tensions between China and its trading partners, especially with Europe."

With Beijing tightening export controls on rare earths, China’s rare earth exports dropped by 34% in June, and were down 6.4% year-to-date for the first half of the year.

In June, China’s overall trade surplus reached $126 billion, up from $105 billion in May. Such a growing trade surplus is increasingly raising concerns among European economies and other governments.

Source: DW, drawing on reports from dpa and AFP

Original article: toutiao.com/article/1870704349169664/

Disclaimer: The views expressed in this article are those of the author alone.