’s trade surplus hit a record US$1.2 trillion in 2025, monthly forex inflows touched US$100 billion, the largest ever, and the global usage of China’s currency, the yuan, has expanded. Experts now predict that Beijing will further expand its global political and economic influence. Backed by its US$20 trillion economy and US$45 trillion worth of stock and bond markets, China is emerging as a “steady partner” for many countries, said Aleksandar Tomic, economics professor at Boston College. “I think China has done a good job and rightly so to position itself as the reliable and stable trade partner,” said Derrick Irwin, co-head of intrinsic emerging markets equity at Allspring Global Investments. “They basically said, look, you’ve got a massive trade partner in the US that’s become a little more uncertain. We can offer predictability and certainty. And I think that’s very fair.” Starmer’s four-day visit to China this week was the first by a British prime minister since 2018 and followed that of Canadian Prime Minister Mark Carney earlier this month, the first Canadian prime minister to visit Beijing since 2017. During Carney’s visit, the two nations signed an economic agreement to reduce trade barriers and forge a new strategic relationship. Carney described China as “a more predictable and reliable partner”. However, China is not alone in seeking new trade pacts to reduce exposure to the United States. India and the European Union concluded a long‑delayed trade agreement on Tuesday that will reduce tariffs on most goods, boosting two‑way trade to potentially double European exports to the South Asian country by 2032. China economy resilient While the world’s two largest economies have been locked in geopolitical disputes for the past few years, Trump’s return to the White House in January 2025 sharply escalated tensions on multiple fronts, including trade and technology. Trump raised tariffs on China to over 100 per cent in April, before partially reversing course and agreeing to a temporary truce, while Beijing increased exports to non-US markets and introduced support measures for its private enterprises and markets. Chinese shipments to the US fell 20 per cent in 2025, but rose 25.8 per cent to Africa, 7.4 per cent to Latin America, 13.4 per cent to Southeast Asia and 8.4 per cent to the European Union last year. “Many countries that previously have not been China-friendly are now kind of pivoting to China … because the United States is becoming a lot less predictable,” Tomic said. “The more the US gets difficult to deal with, the more it opens up for China.” Despite trade tensions with the US, China’s economy, under deflationary pressures at home due to weak domestic consumption and a long-term slump in the property sector, has met the government’s target of 5 per cent growth in 2025. In recent months, China has taken a range of measures to boost foreign investment, including pilot programmes in Beijing, Shanghai, and other regions to expand market access in services such as telecommunications, healthcare, and education. The country recorded the largest-ever monthly foreign exchange inflows of US$100.1 billion in December, according to bank settlement data from its foreign exchange regulator. Its official foreign exchange reserves reached a 10-year high of US$3.36 trillion. Its financial market has emerged robust, with the Shanghai index climbing 27 per cent over the past year, outperforming US equities, market turnover hitting a record high, and the yuan expanding its global usage. With the dollar becoming less appealing to investors due to Trump’s erratic approach to trade and international diplomacy, Beijing is also pushing ahead with its ambition to bolster the global usage of the yuan, said bankers with knowledge of the matter. Some of the major global banks are scrambling to boost yuan liquidity in offshore hubs and to put in place frameworks for faster yuan payment settlements in trade corridors across China, Southeast Asia, the Middle East, and Europe, they added. “We have seen quite a few cycles of China trying to internationalise the yuan and then pulling back,” said a banker at a global bank with China presence. “This time it’s different … Trump policies are very conducive to boosting yuan usage.” More than half of China’s cross-border transactions are now settled in yuan, from almost none 15 years ago, while nearly half of China’s overseas bank lending is now in renminbi, according to the latest data from the PBOC and SAFE. China caution But some foreign policy analysts caution against China’s new, friendlier economic and political playbook. Despite the new trade pacts, Patricia Kim, a foreign policy fellow at the Washington-based Brookings Institution, said that distrust of the US does not translate into trust in Beijing among US allies and partners. “Many of these countries harbour deep concerns about China’s approach to trade, its use of economic coercion, and unresolved maritime and historical disputes,” Kim said. “In the current moment, China may appear more restrained or pragmatic when compared with the Trump administration’s extreme rhetoric and actions. But Beijing’s actual behaviour has not been especially reassuring.” Reporting by Liz Lee in Beijing, Samuel Shen in Shanghai and Sumeet Chatterjee in Hong Kong. Editing by Michael Perry. All courtesy of Reuters.