The China Scoreboard

In 2024, the United States traded $661 billion in goods and services with China — $199 billion in exports and $461 billion in imports. That makes China America’s third-largest trading partner overall, behind Mexico and Canada but ahead of Japan, Germany, and the United Kingdom. The combined deficit was $262 billion: a $295 billion goods deficit partly offset by a $33 billion services surplus.

These numbers are large by any standard. But they are smaller than they were. At the 2018 peak, total goods-and-services trade with China was $739 billion and the combined deficit was $377 billion. The decline of $78 billion in total trade and $115 billion in the deficit represents a meaningful contraction — the first sustained reversal in a relationship that grew every single year from 1999 to 2018.

Perhaps the most telling number is China’s share of total U.S. goods imports. It peaked at 21.5% in 2017 — meaning more than one in five dollars Americans spent on imported goods went to China. By 2024, that share had fallen to 13.3%. An 8.2 percentage-point decline in seven years. No other trading partner has experienced such a rapid shift in share. The trade isn’t disappearing — it’s being rerouted.

The goods trade tells the core story. American imports from China rose from $82 billion in 1999 to $539 billion in 2018 — a 6.6-fold increase over nineteen years. Then they fell. By 2024, imports were $440 billion, down $100 billion from the peak. Exports followed a different trajectory: they grew from $13 billion to a peak of $156 billion in 2022, then retreated to $144 billion.

The goods deficit hit its all-time high of -$417 billion in 2018, the year the trade war began. By 2024, it had narrowed to -$295 billion — a $122 billion improvement. That sounds like progress, but context matters. The deficit reduction came primarily from import suppression (tariffs making Chinese goods more expensive) rather than export growth (which actually declined). And much of the diverted trade simply went to other countries.

The composition of U.S.-China trade in 2024 reveals the structural asymmetry at the heart of this relationship. America buys finished products from China: $214 billion in consumer goods (electronics, appliances, clothing, furniture) and $145 billion in capital goods (computers, telecom equipment, electrical apparatus). America sells inputs to China: $49 billion in industrial supplies (chemicals, plastics, metals) and $49 billion in capital goods (semiconductors, machinery, aircraft engines), plus $23 billion in food.

The largest single deficit category is consumer goods: America imports $214 billion and exports just $15 billion, producing a -$199 billion gap. That one category accounts for two-thirds of the entire goods deficit. Capital goods add another -$96 billion. Industrial supplies is roughly balanced (+$6 billion for the U.S.). Food is a bright spot: America runs an $18 billion surplus with China in agricultural products, though that figure is down from a $31 billion peak in 2022 when Chinese buyers pulled forward soybean purchases.

Even at $295 billion, China remains America’s largest goods deficit partner by a wide margin. Mexico is second at $181 billion, followed by Vietnam at $123 billion. But the gap is narrowing. In 2018, China’s deficit was 3.5 times Mexico’s. By 2024, it was only 1.6 times. At current trajectories, Mexico could overtake China as the largest deficit partner within a few years.

The services side tells a different story. China is America’s fourth-largest services surplus partner at +$33 billion, behind Ireland (+$53 billion), the Caribbean (+$40 billion), and Canada (+$33 billion). This surplus — driven by Chinese students paying American tuition, Chinese tourists spending in American hotels, and American financial and technology firms earning fees from Chinese clients — offsets about 11% of the goods deficit. It’s a meaningful number, but not enough to change the overall picture.

The 25-year arc of U.S.-China trade has a structure that the data makes unavoidable. There are three distinct eras, each with its own internal logic:

The Great Opening (1999–2008): China joined the WTO. Imports quadrupled from $82 billion to $340 billion. The deficit went from $69 billion to $268 billion. American retailers restructured supply chains. Chinese factories scaled from village workshops to world-beating industrial complexes. Two to three million American manufacturing jobs were displaced. Consumer prices fell. Corporate margins widened. The benefits were diffuse (cheaper goods for 330 million consumers) and the costs were concentrated (factory closings in specific communities).

Mature Dependency (2009–2017): Growth slowed but the relationship deepened. Imports stabilized around $450–$500 billion. The deficit calcified in the $315–$375 billion range. American companies built R&D centers in China. Chinese companies listed on American stock exchanges. Services trade blossomed — 350,000 Chinese students enrolled in American universities by 2017. The relationship became too large and entangled for either side to exit cleanly.

The Attempted Breakup (2018–present): Section 301 tariffs hit $250 billion in Chinese goods (later expanded to nearly all imports). China retaliated on $110 billion in American goods. COVID disrupted supply chains. Export controls blocked advanced semiconductors. The deficit peaked at $417 billion in 2018 and fell to $295 billion by 2024. China’s import share dropped from 21.5% to 13.3%. But the trade didn’t disappear — it migrated. Vietnam’s deficit with the U.S. tripled. Mexico’s grew by $55 billion. Taiwan’s surged by $45 billion. Some of this represents genuine diversification. Some of it represents Chinese goods transshipping through third countries.

The scoreboard yields five conclusions that the data supports clearly:

First, the deficit has narrowed but not vanished. The $122 billion reduction from the 2018 peak is real, but a $295 billion deficit remains enormous — larger than America’s total trade with most countries. Tariffs have bent the curve, not reversed it.

Second, trade is being rerouted, not eliminated. China’s loss has been Vietnam’s, Mexico’s, and Taiwan’s gain. America’s total goods deficit with the world actually worsened from $879 billion in 2018 to $1.215 trillion in 2024. The China-specific improvement was swamped by increases elsewhere.

Third, services trade is America’s structural advantage. The $33 billion services surplus is built on education, tourism, finance, and intellectual property — areas where American institutions have enduring competitive advantages. This surplus could grow significantly if geopolitical tensions ease, or collapse if they worsen.

Fourth, financial decoupling is running ahead of trade decoupling. FDI flows are minimal ($5 billion U.S.-to-China, $2 billion China-to-U.S.). Portfolio investment has turned to net selling. The primary income balance flipped negative for the first time in 2024. The financial relationship is thinner than the trade numbers suggest.

Fifth, the relationship is still massive. At $661 billion in total goods-and-services trade, the U.S.-China commercial relationship dwarfs most bilateral relationships in history. Even after six years of active policy to reduce dependence, China remains America’s third-largest trading partner. The entanglement took two decades to build. Unwinding it — if that is indeed the goal — will take at least as long.