Yiwu Defies Trade Pressures With Rapid Expansion Into Emerging Markets

Yiwu overcame US-China trade tensions by rapidly diversifying exports toward emerging markets. Despite tariffs and reduced US demand, total trade surpassed 700 billion yuan in the first 10 months of 2025, up 25.2%. ASEAN trade jumped 51%, while Africa and Latin America rose strongly. Exports grew 24.4%, alongside booming cross-border e-commerce imports, supported by flexible supply chains and logistics networks.

When trade tensions between China and the United States intensified in April, exporters in Yiwu were widely expected to face a difficult adjustment. Higher tariffs disrupted long-established trade relationships, particularly with American buyers who had historically accounted for a meaningful share of the city’s overseas sales.

Contrary to those expectations, many Yiwu-based firms ended the year in a stronger position than before. Instead of absorbing losses, exporters accelerated their push into new overseas markets, particularly across the Middle East, Central Asia and Africa. This diversification strategy proved effective, with export volumes rising despite the sharp escalation in trade barriers.

Yiwu, located in China’s eastern Zhejiang province, is one of the world’s largest wholesale trading hubs and a major source of low-cost consumer goods for global markets. Although exports to the United States had already been gradually declining, the American market still accounted for nearly 15 per cent of the city’s total exports in 2024, leaving Yiwu exposed as tariffs climbed to triple-digit levels.

Even so, the city managed to replace reduced US demand with surprising speed. According to local customs data, Yiwu’s combined imports and exports exceeded 700 billion yuan (approximately US$99 billion) in the first 10 months of 2025. This marked a year-on-year increase of 25.2 per cent and surpassed the city’s total trade volume for the entirety of the previous year.

A decisive shift toward emerging markets has been central to this performance. Trade with members of the Association of Southeast Asian Nations (ASEAN) surged 51 per cent over the same period, while goods flows with Africa and Latin America increased by 21.8 per cent and 14 per cent, respectively. These regions have increasingly become the primary drivers of Yiwu’s export growth.

Markets in West Asia and South America have shown particularly strong demand. Many of these economies are either rebuilding infrastructure after prolonged conflict or experiencing gradual consumption upgrades despite limited purchasing power. Yiwu’s long-standing advantage—offering functional, affordable goods at scale—has aligned well with these conditions.

Demand has been especially strong for construction materials, household products and machinery, reflecting ongoing reconstruction efforts and development projects across several emerging economies. Exporters have reported steady growth in orders tied to these sectors, helping sustain overall trade momentum.

Yiwu’s adaptability has also been attributed to its market-driven development model. Unlike cities shaped primarily by industrial policy, Yiwu’s commercial ecosystem has evolved largely through private initiative, dense trader networks and highly flexible supply chains. This structure has allowed local businesses to respond quickly to global shifts, enabling the city to outperform many larger Chinese urban centres during a period of heightened uncertainty.

The impact of this shift is reflected in export figures. In the first 10 months of the year, Yiwu recorded a 24.4 per cent increase in exports compared with the same period last year, supported by expanding overseas demand and favourable trade conditions.

Local authorities have reinforced this momentum by actively promoting Yiwu-made products abroad. A series of overseas trade fairs have been held in Thailand and Vietnam, while a cultural goods exhibition hosted in Indonesia in November attracted strong interest from regional buyers. These efforts have coincided with strengthening trade ties between China and Southeast Asia.

The signing of the China–ASEAN Free Trade Area 3.0 agreement in October provided an additional boost, arriving at a time when Southeast Asian demand for Chinese goods was already accelerating.

While exports remain Yiwu’s most visible strength, imports are also expanding rapidly. Leveraging its advanced logistics infrastructure and low delivery costs, the city has become a major national distribution hub for cross-border e-commerce imports.

Since Yiwu began accepting bonded cross-border e-commerce imports in 2019, inbound shipment volumes have risen sharply. The number of incoming orders increased from 8.7 million in 2019 to more than 60 million in 2023, before exceeding 80 million in 2024.

Today, 121 cross-border e-commerce companies operate in the city, including several of China’s largest international retail platforms, according to customs authorities. This growth underscores Yiwu’s expanding role not only as an export powerhouse, but also as a critical node in China’s inbound digital trade network.

Together, these trends highlight how diversification, logistical efficiency and market responsiveness have enabled Yiwu to turn external trade pressures into a new phase of global expansion.