In January, when Beijing announced a trade surplus for 2025, the press saw resilient communism defeating American tariffs.
Reuters: “China’s trade ends 2025 with record $1.2 trillion surplus despite Trump tariff jolt”
CNN: “China notches historic $1.2 trillion trade surplus despite Trump tariffs”
AP: “China’s trade surplus surges 20% to a record $1.2 trillion, even with Trump’s tariffs”
A few facts
No doubt this trade surplus would be a newsworthy surprise…if true. It is false. We know this because of a few facts that any journalist could have discovered.
● Last year, Red China changed the way it accounts for its trade surplus.
● Beijing assigns trade targets to regions—with rewards for reaching the targets. This encourages lying and cheating.
● Cheating is widespread and easy.
The Diplomat cites a “widely cited case in central China’s Hubei Province” involving “the creation of more than 100 shell companies that collectively obtained hundreds of millions of yuan in subsidies while generating export figures in the tens of billions of yuan” simply by manipulating export records.
The incentives also generate empty containers with imaginary contents. Don’t underestimate the rewards that may be reaped by shipping them around the world.
Needless to say, Red China treats its data as another form of propaganda. Take growth, for instance: “The Rhodium Group, a respected global consultancy, has alleged that the official growth numbers are highly exaggerated and that Beijing has misled both the public and investors by releasing inflated data. According to the firm, China’s underlying economic indicators are inconsistent with the government’s headline growth figures.”
Statistical theater
Beijing excels in what China analyst Miles Yu calls “statistical theater.” He says that the country’s export numbers “are fake and unreliable—and the West keeps pretending they’re gospel because the headlines are politically convenient. A strong CCP export print is often used to ‘prove’ tariffs failed and to dunk on Trump-era trade policy. But China’s own reporting (e.g., China Business Network or Yicai Global) shows how the game works: real goods, fake attribution, shell firms ‘buy’ export records, and subsidies reward the paperwork, not the production.”
GovFacts notes that “China’s trade surplus hit $1.19 trillion in 2025 [but only] $160 billion of it showed up in the country’s foreign exchange reserves.” This is a pretty strong indication of cheating. “When a country runs a massive trade surplus, economic theory says its central bank should be buying foreign currency to prevent its own currency from strengthening. That intervention leaves a trail….”
So if Beijing is following “economic theory,” it would be converting surplus capital into dollar holdings. This is one way the U.S. government assesses the situation in order validate or invalidate claims of a trade surplus.
The problem with this method is that it is antiquated. Red China is settling trade in its own currency, as much as it can. It is also buying non-U.S. currency and investments with surplus cash. Our Treasury sleuths are not tracking these developments. So there’s bad data on our side as well.
But this deficiency should not overshadow the role of Chinese fraudsters in concocting China’s fake trade surplus. “A Shanghai metals trading outlet reported that fake invoices accounted for roughly 30 percent of steel exports in 2023 and 2024. New rules took effect October 1, 2025, to crack down on this practice, but enforcement remains uncertain.”
Import/export fraud. How about some good old money laundering? GovFacts suggests that the trade figures “might be inflated through fake shipping documents used to move money illegally. Some Chinese exporters have historically overstated shipments to move money offshore or evade capital controls.”
Money flees the dictators, and this flight is turned into a plus, a positive export statistic.
When countries politicize
Meanwhile, China blames the United States for the trade imbalance. Wang Jun, vice minister of the General Administration of Customs of China, says that “some countries politicise economic and trade issues, restricting high-tech exports to China under various pretexts. Otherwise, we would have imported even more.”
They want to buy our best stuff. So stop preventing trade, America!
CNN has provided its own shall we say contrarian analysis of the trade surplus figures. It published a piece raving that “the record $1.2 trillion annual trade surplus [that China’s] authorities reported…is resounding proof of the resilience of its economy in the face of US trade friction.”
Further, China’s “trade juggernaut” has “already showed its capacity to adapt, with its exporters swiftly pivoting from US consumers toward emerging markets in Southeast Asia, Africa and Latin America…. And the staggering surplus figure is also testament to the country’s rapid climb to dominate green technologies like EVs, lithium-ion batteries, and solar panels, as well as its prowess in making machinery and tech products at scale.” (All emphasis added.)
It would seem that the Reds are not only surplussing like crazy, they are deeply worthy of such surpluses.
Reporting like this provides even more incentives to lie with statistics. □
James Roth works for a major defense contractor in Virginia.
Also see:
Archive.org: “How to Lie With Statistics”
