China’s growing trade surplus with the European Union (EU) continues to raise concerns that the region is becoming a target for redirected exports. In the first four months of 2025, China’s trade surplus with the EU reached a record $90 billion, driven by a combination of tariff pressures from the U.S. and favorable currency conditions.

While some Chinese exports are rerouting through Latin America and Southeast Asia, large volumes are heading directly to Europe due to its substantial consumer base. U.S. tariffs are still higher than at the start of the year, giving China more reason to redirect goods to Europe. The yuan’s recent decline to a decade-low against the euro has made Chinese goods even more affordable in Europe.

Recent meetings between French and Chinese officials in Paris, highlight ongoing efforts to maintain cooperation.  Germany, traditionally a strong trading partner with China, is also seeing a shift. In 2020, China had a trade deficit of more than $18 billion with Germany. By 2024, that had reversed to a surplus of $12 billion. Projections point to a potential $25 billion surplus by the end of the year.

EU officials are closely assessing the situation.  EU trade chief, Maros Sefcovic, confirmed the 27-nation bloc is monitoring containerized imports from China for signs of redirected Trans-Pacific trade flows to Europe.

Source: gCaptain