BEIJING/HONG KONG, Jan 29 — When US President Donald Trump took office a year ago with an “America First” agenda, many saw trouble ahead for China’s sluggish economy. Instead, Beijing has thawed frosty relationships with other trade partners to post a record trade surplus.

While Trump’s policies have strained ties with traditional US allies, China has turned its focus to strengthening relationships with key partners, including Canada and India, analysts say.

As a result, the world’s second-largest economy recorded a record trade surplus of US$1.2 trillion (RM4.70 trillion) in 2025. Monthly foreign exchange inflows hit US$100 billion (RM391.40 billion) – the highest ever – while global usage of China’s currency, the yuan, continued to expand.

When British Prime Minister Keir Starmer lands in China on Wednesday evening, hoping to reinvigorate recently strained business ties, analysts say Beijing is expected to further broaden its political and economic influence.

Backed by a US$20 trillion (RM78.28 trillion) economy and US$45 trillion (RM176.13 trillion) in stock and bond markets, China is emerging as a “steady partner” for many countries, said Aleksandar Tomic, an economics professor at Boston College.

“I think China has done a good job positioning itself as a reliable and stable trade partner,” said Derrick Irwin, co-head of intrinsic emerging markets equity at Allspring Global Investments.

“They’re essentially saying: you’ve got a massive trade partner in the US that’s become more uncertain. We can offer predictability and certainty,” he added.

Starmer’s four-day visit will be the first by a British prime minister since 2018. It follows a visit earlier this month by Canadian Prime Minister Mark Carney — the first Canadian leader to travel to Beijing since 2017.

During Carney’s trip, the two countries signed an economic deal aimed at reducing trade barriers and forging a new strategic relationship. Carney described China as “a more predictable and reliable partner”.

China is not alone in seeking new trade relationships to de-risk from the US. India and the European Union struck a long-delayed trade deal on Tuesday that will slash tariffs on most goods, potentially doubling European exports to India by 2032.

China economy resilient

While the world’s two largest economies have been locked in geopolitical disputes for years, Trump’s return to the White House in January 2025 sharply escalated tensions, particularly over trade and technology.

Trump raised tariffs on Chinese goods to over 100 per cent in April, before partially reversing course and settling for a temporary truce. Beijing responded by boosting exports to non-US markets and rolling out support measures for private enterprises and financial markets.

Chinese shipments to the US fell 20 per cent in 2025, but exports rose 25.8 per cent to Africa, 7.4 per cent to Latin America, 13.4 per cent to South-east Asia and 8.4 per cent to the European Union.

“Many countries that were previously not China-friendly are now pivoting towards Beijing because the US is becoming less predictable,” Tomic said.

Despite trade tensions with the US, China’s economy – under deflationary pressure from weak domestic consumption and a prolonged property slump – met the government’s growth target of 5 per cent in 2025.

In recent months, Beijing has introduced measures to attract foreign investment, including pilot programmes in Beijing, Shanghai and other regions to expand market access in sectors such as telecommunications, healthcare and education.

China recorded its largest-ever monthly forex inflows of US$100.1 billion (RM391.79 billion) in December, according to data from its forex regulator. Official reserves hit a 10-year high of US$3.36 trillion (RM13.15 trillion).

The country’s financial markets have also shown resilience, with the Shanghai index climbing 27 per cent over the past year, outperforming US equities.

With the US dollar becoming less appealing due to Trump’s erratic trade and foreign policy, Beijing is pushing ahead with efforts to boost global usage of the yuan, bankers said.

More than half of China’s cross-border transactions are now settled in yuan, compared with almost none 15 years ago, while nearly half of China’s overseas bank lending is denominated in renminbi, according to data from the PBOC and SAFE.

China caution

Despite Beijing’s friendlier economic diplomacy, some foreign policy analysts urge caution.

Patricia Kim, a fellow at the Brookings Institution, said distrust of the US does not automatically translate into trust in China.

“Many countries harbour deep concerns about China’s approach to trade, its use of economic coercion, and unresolved maritime and historical disputes,” she said.

“In the current moment, China may appear more pragmatic compared with the Trump administration’s rhetoric, but Beijing’s actual behaviour has not been especially reassuring.” — Reuters