China's trade surplus has crossed the $1 trillion mark for the second consecutive year, with exports recording strong growth in October amid rising international pressure on Beijing to address trade imbalances.

According to data released by China's customs agency on Tuesday, exports jumped 35.2 percent year-on-year in October, driven largely by strong overseas demand for high-tech products, including semiconductors and automobiles. Imports also increased significantly, rising 41.6 percent from a year earlier.

China recorded a trade surplus of $1.04 trillion during the January-October period. However, the surplus narrowed to $105.3 billion in October from $133.5 billion in September as imports gained momentum.

The latest figures indicate that China could surpass its previous annual record of $1.2 trillion in trade surplus, set last year, in 2026.

"We expect Chinese exports to stay strong for the rest of this year, led by electronics and autos," said Dave Chia, an economist at Moody's Analytics.

The increase in imports in October was partly driven by a recovery in crude oil shipments from the Persian Gulf.

Alicia García-Herrero, chief economist for Asia Pacific at French bank Natixis, said China's industrial overcapacity, high domestic savings and weak consumer demand were continuing to push manufacturers to sell more goods overseas. This trend is prompting some countries to introduce measures to protect their domestic industries.

She warned that the situation was unsustainable.

Chinese businesses are also facing mounting competitive pressure as economic growth slows. Cinders Zhou, an eyewear seller working for a manufacturer in Linhai city of eastern Zhejiang province, said intense competition had increasingly forced companies to lower prices.

He attributed the situation to declining product quality and a lack of differentiation across the industry, noting that manufacturers were increasingly competing on price.

Chia said trade restrictions imposed by the European Union posed a significant risk to Chinese exporters amid heightened US tariffs and other trade barriers.

However, Nguyen Hoang Nam of Capital Economics said the EU measures covered only a relatively small portion of China's exports.

Beijing has maintained that it does not seek to expand its trade surplus and instead supports more balanced global trade.

Nevertheless, robust exports have helped offset weak domestic demand, keeping China's economy on course to achieve the government's annual growth target of 4.5 to 5 percent. The projected expansion would be slightly below last year's 5 percent growth.

China's exports to the United States rose 32.9 percent year-on-year in October, building on a relatively low base following last year's trade disruptions caused by higher tariffs imposed by US President Donald Trump.

Shipments to the European Union also increased, climbing 24.3 percent in October. During the first ten months of the year, exports to the bloc grew 17.2 percent.

China's trade surplus with the United States reached around $266.5 billion during January-October, while its surplus with the EU exceeded $310 billion. In 2025, the EU recorded a trade deficit of approximately $410 billion with China, equivalent to more than $1.1 billion a day.

However, Chinese trade figures often differ from data published by its trading partners.

Among individual sectors, semiconductor exports surged 137.1 percent in value in October compared with the same month last year, while automobile exports rose 37.6 percent.

Chia warned that China's export outlook could be affected by a potential slowdown in the artificial intelligence industry. Concerns have grown following Democratic victories in US midterm elections amid public opposition to the rapid expansion of data centres.

"If the AI boom slows or turns into a correction, lower chip and electronics prices and smaller shipping volumes would hit China's exports hard," he said.

Trade is also expected to feature prominently in planned discussions between Trump and Chinese President Xi Jinping next week on the sidelines of the Asia-Pacific Economic Cooperation leaders' summit in Shenzhen, China's technology hub.

A two-month extension of the trade truce between the two countries until January has offered some relief to Chinese exporters, although uncertainty remains over its longer-term prospects.

Wang Xin, head of the Shenzhen Cross-Border E-Commerce Association, said US and European trade policies had created considerable difficulties for Chinese businesses seeking to expand in those markets.