Economists rethink China forecasts as AI imports surge

issued Monday, April 27, 2026 · 08:20 AM

Economists have sharply revised upward their forecasts for China’s import growth, predicting that it will outpace export expansion for the first time since 2021 and do not expect the trade balance to swell significantly beyond last year’s record.

Imports are expected to jump to 5% in 2026, a five-year high, as Chinese companies ramp up procurement of high-end chips needed for artificial intelligence, according to the median estimate in a Bloomberg survey of 17 economists this month. This is more than double the increase expected in March and follows four years of stagnation and decline.

Export growth was also revised upward from 3.6% to 4.9%, putting China on track to achieve a goods surplus of just over $1.2 trillion after two consecutive years of rapid growth, just barely above its 2025 level.

Since the pandemic, China has faced a backlash from abroad, with the flow of Chinese products into overseas markets, but the government has responded by pledging to open the domestic market to imports and rolling out gradual measures, including removing tax breaks for exporters of products such as solar cells. However, as domestic demand is suppressed due to sluggish consumption, China is accelerating imports due to its reliance on cutting-edge technologies related to AI.

“The government has realized that the huge trade surplus is not sustainable,” said Serena Zhou, senior China economist at Mizuho Securities.

He expected imports to rise by 7.5% this year, thanks in part to policy adjustments, but said overseas sales would remain the economy’s main growth driver. “So far, we have not seen a clear recovery in domestic demand,” Zhou said.

Economists are suddenly changing some of their forecasts for China after a strong quarter for trade despite the worst energy disruption in generations caused by the Iran war.

In the first three months of 2026, imports increased by 23% compared to the same period last year, while exports increased by 15%. Although industrial production and investment are on track, sluggish consumption has left China lopsided, and the International Monetary Fund says it is contributing to global imbalances.

The unexpected surge in imports in March was largely the result of a global AI investment boom that is boosting demand for chips and advanced manufacturing equipment.

Rising chip prices also had an impact. The value of integrated circuits imported by China soared 54% last month from a year earlier, accounting for almost a third of the overall growth, even though volumes rose only 14%, according to estimates from Pantheon Macroeconomics.

The AI ​​spending boom, which is predicted to reach US$2.5 trillion this year, has been a key driver of Asian trade over the past year.

China emerged as the world’s largest supplier of AI-related products last year, but it remains a net importer of some key technologies, particularly advanced chips, according to a study by economists at Standard Chartered. Taiwan and South Korea, where China sources most of its AI-related imports, have reported sharp increases in exports to China in recent months.

Besides AI, other factors are also helping buoy imports.

Over the past year, the yuan has appreciated nearly 7% against the dollar, increasing purchasing power for households and businesses. Due to the rise in metal prices, the import value of products made from copper and aluminum is also rising.

Statistics for March show that China’s crude oil purchases have decreased only slightly, and so far the rise in global crude oil prices has not had a major impact on the growth in China’s overseas purchases.

But traffic in the Strait of Hormuz, a key energy waterway, has plummeted, which is likely to weigh on imports in the coming months. Pantheon Macroeconomics expects oil and gas imports to fall by 14% and 18%, respectively, in April.

The positive outlook for exports reflects some unexpected benefits of the war for China.

Rapidly increasing demand for green energy products is prompting more Chinese companies, including automakers, to expand overseas. And compared to other countries, China’s supply chain can withstand energy shocks.

“China’s economy has proven more resilient to supply shocks related to the Iran war than many Asian countries,” said Erica Tay, an economist at Maybank Securities. “Growing global demand for EVs and solar panels will provide a tailwind as Chinese companies dominate these sectors.”Bloomberg