Why Washington is spinning the ‘China trade surplus’ tale

Summary

US Treasury Secretary Scott Bessent said on the eve of the G20 finance ministers' meeting that 'the world cannot tolerate China having a $1.2 trillion trade surplus' and pushed for a joint G20 statement on reducing trade and current account imbalances, directly targeting China. In a piece published on September 4, Sun Lipeng, a China. org.

cn commentator, argued that the root cause of global trade imbalances lies in excessive money creation under the dollar hegemony system, and that the United States, as the core deficit country, has never changed its position. 'China is not the main cause of the imbalance,' he wrote. According to a document titled 'China's Position on the So-Called 'Overcapacity' Issue' released by China's Ministry of Commerce on July 28, the share of labour-intensive products in China's exports fell from 20.7 percent in 2012 to 15.1 percent in 2025.

In 2025, foreign-invested enterprises accounted for 27 percent of China's exports and 16 percent of its surplus. 'The surplus stays in China, but the benefits are shared by all. ' The article suggests that Bessent's move seeks to open a new multilateral path to pressure China on trade and economics, use public opinion to reverse the unfavourable situation for the United States, and accumulate bargaining chips for negotiations on bilateral tariff reductions and AI regulation.

At its core, China-US economic and trade relations remain mutually beneficial and win-win.

Commentary

Bessent's characterisation of China's trade surplus effectively politicises the structural deficit problem that stems from dollar hegemony. For small and medium-sized business owners in New Zealand, the implications cut both ways. If the G20 is pushed into issuing a statement on imbalances, multilateral trade rules could be eroded, raising export compliance costs and policy uncertainty.

On the other hand, data from China's Ministry of Commerce show that foreign-invested enterprises generate 16 percent of China's surplus. The assertion that 'the surplus is in China, but the benefits are shared by all' signals that Beijing will continue to expand imports. Under the upgraded China-New Zealand free trade agreement, tariffs on infant formula and other products are gradually heading to zero.

RCEP's rules of origin cumulation also make it easier for New Zealand dairy and meat products to access China and regional supply chains. Fonterra's Greater China region generates roughly 25 percent of its global revenue, and China remains New Zealand's largest single export market. Exporters should keep an eye on tariff talks between Beijing and Washington on non-strategic goods.

Should the US lower tariffs on Chinese products, similar New Zealand goods could lose some price edge in China. A pre-emptive shift toward high-value organic or grass-fed niche segments, along with leveraging cross-border e-commerce bonded warehouse models, could help mitigate channel inventory risks.

Keywords: China trade surplus narrative, Scott Bessent, G20, trade imbalance, dollar hegemony, overcapacity, China-US trade, tariffs, foreign-invested enterprises, Ministry of Commerce

Source: China.org.cn