BEIJING – Economists have sharply upgraded their forecasts for China’s import growth and now expect it to overtake the pace of expansion in exports for the first time since 2021, keeping the trade balance from ballooning much beyond 2025’s record.
As Chinese companies hoover up high-end chips needed for artificial intelligence, imports are set to jump to a five-year high of 5 per cent in 2026, according to the median estimate of 17 economists polled by Bloomberg in April. That’s more than double the gain predicted in March and would follow four years of stagnation and decline.
With growth in exports also upwardly revised to 4.9 per cent, from 3.6 per cent, China is on track to run a goods surplus of just over US$1.2 trillion (S$1.5 trillion), barely topping its level in 2025 after two straight years of rapid gains.
Faced with pushback abroad as Chinese goods flooded into foreign markets since the Covid-19 pandemic, the government has responded by pledging to open the domestic market to imports and rolling out incremental policies such as removing tax incentives for exporters for products such as solar cells. But it’s China’s reliance on cutting-edge technologies linked to AI that’s kicking imports into higher gear, as weak consumption restrains demand at home.
“The government has realised the huge trade surpluses are not sustainable,” said Serena Zhou, senior China economist at Mizuho Securities.
While forecasting that imports will grow 7.5 per cent in 2026, partly thanks to policy adjustments, she said foreign sales will remain a key growth engine for the economy. “So far I haven’t seen a clear revival in domestic demand yet,” said Ms Zhou.
Economists are abruptly shifting some forecasts for China after a quarter when trade boomed despite the worst energy disruption in generations triggered by the war in Iran.
Imports soared 23 per cent in the first three months of 2026 from a year ago and exports climbed 15 per cent. Though industrial production and investment are taking off, stagnating consumption is leaving China with a lopsidedness that the International Monetary Fund says is contributing to global imbalances.
The unexpected surge in imports in March was in large part a result of a global boom in AI investment that’s propelling demand for chips and advanced manufacturing equipment.
Surging chip prices also played a role. The value of integrated circuits imported by China soared 54 per cent in March from a year ago, accounting for almost a third of total growth, even as their volume only rose 14 per cent, according to estimates from Pantheon Macroeconomics.
The AI spending boom – forecast to reach US$2.5 trillion in 2026 – has become a significant driver of trade in Asia over the past year.
While China has emerged as the world’s largest supplier of AI-related goods in 2025, it’s still a net importer of some critical technologies, especially advanced chips, according to research by economists at Standard Chartered. Taiwan and South Korea, where China sources most of its AI-related imports, both reported surging exports to China in recent months.
Apart from AI, other factors are also helping buoy imports.
The yuan has strengthened close to 7 per cent against the US dollar over the past year, lifting the purchasing power of households and businesses. A rally in metal prices is also inflating the import value of products made of copper and aluminum.
So far, higher global oil costs are yet to have a significant impact on growth in China’s foreign purchases, as March data showed only a modest decline in its buying of crude.
But a sharp reduction in traffic through the Strait of Hormuz, a vital waterway for energy, will likely create a drag on imports in the coming months. Pantheon Macroeconomics expects oil and gas import values to fall sequentially in April by 14 per cent and 18 per cent, respectively.
The rosier outlook for exports reflects several inadvertent benefits from the war for China.
A surge in demand for green energy products is helping Chinese companies including carmakers make further inroads abroad. And compared with other countries, China’s supply chains are more able to withstand an energy shock.
“China’s economy has proven more resilient to Iran war-related supply shocks than many Asian countries,” said Erica Tay, an economist at Maybank Securities. “Rising global demand for EVs and solar panels would even be a tailwind, as Chinese firms are dominant in these fields.” BLOOMBERG
