FX.co ★ China dials back trade with US while increasing engagement with EU

For the first five months of 2026, trade between the United States and China has declined, while Beijing’s trade volumes with Europe have seen significant growth. According to data from China’s General Administration of Customs, US-China trade dropped by 3.5% from January to May, totaling $231.25 billion. Exports of Chinese goods to the US fell by 2.7% to $172.46 billion, while imports of American products into China decreased by 5.5%, reaching $58.78 billion.

Conversely, China’s economic relations with its European partners exhibit a different trend. During the same period, China’s trade with the European Union countries expanded by 13.9% year-over-year, reaching $364.15 billion. Shipments of Chinese goods to EU nations surged by 16.4% to $253.97 billion. Imports of European goods into China also demonstrated positive momentum, increasing by 8.6% to $110.19 billion. This clearly indicates a reorientation of trade flows.

Despite these upward trends, the cooperation between Beijing and Brussels is threatened by the risk of large-scale trade conflicts. According to China Daily, the EU’s protectionist measures aimed at safeguarding its green economy have significantly undermined China’s exports of environmentally friendly products and limited the influx of investment. If the EU continues to erect barriers, Chinese businesses may lose their willingness to enter the local market. If this policy persists, Beijing warns of inevitable retaliatory measures to protect its corporations.