China's growing exports: Not just transshipment - Standard Chartered

China's y/y export growth accelerated during H1 despite a sharp decline in exports to US. Phones and laptops comprised an outsized share of China's declining exports to the US. China appears to be exporting these goods to alternative markets, not just transshipment hubs, Standard Chartered's Research Analyst Ethan Lester reports.

Diversification pays off

"China's export partners have diversified in recent years, helping to offset the blow from higher US tariffs. The US share of China's 6M-2025 exports declined 2.5ppt y/y, but China's overall exports increased, even after adjusting for reporting discrepancies with US authorities."

"We see China's export growth boost fading following significant tariff-related front-loading, amid protectionist rhetoric from EU officials regarding dumping, and US threats of higher tariffs on economies facilitating transshipment. However, China's ongoing export diversification should provide a robust floor for exports despite headwinds from protectionism, building on over a decade of significant investment abroad in global south economies."

"For example, exports of smartphones and laptops - which accounted for roughly one-third of the c.11% y/y decline in China's exports to the US during H1-2025 - have grown significantly across Latam, SSA, Europe, and EM Asia. US imports of smartphones and laptops are not widely increasing from the same destinations as China's exports; this is despite the incentive for transshipment of China's electronic goods amid the ongoing US national security investigation into semiconductors and their downstream uses. China's increased exports of intermediate goods since the previous trade war also suggests a genuine reorientation of supply chains rather than merely export rerouting."