US targets China’s global trade surplus at G20 meeting ahead of Xi-Trump summit

US Treasury Secretary Scott Bessent on Monday targeted China’s global trade surplus, raising concerns over “excessive imbalances,” weeks before Chinese President Xi Jinping is expected to arrive in Washington for a bilateral summit with US President Donald Trump.
“We are confronting persistent global imbalances that undermine prosperity,” Bessent said in his opening address at the G20 Finance Ministers’ meeting in Asheville, North Carolina. The United States holds the G20 presidency in 2026, leading a forum of the world’s major advanced and emerging economies.
Without naming China, Bessent said that the grouping’s finance ministers and central bank governors “have broadly concurred that it is in the interests of both surplus and deficit countries to address excessive imbalances”.
“We have seen how distorted policies that privileged countries’ own exports have harmed many of the economies represented here today,” he said, adding that a “durable global economy cannot rest on beggar-thy-neighbour acts that stifle fair market-based competition.”

Washington has made trade imbalances a key theme of the G20 ministerial – part of decades-long complaints about Beijing’s high trade surpluses – as a surge in Chinese exports of major products such as automobiles, solar panels and batteries has raised concerns in many countries over Beijing’s alleged “overcapacity”.
Governments have attributed the surplus production to weak pro-consumer policies and to state subsidies, a charge China denies. China’s global export volume surged to a record US$1.2 trillion in 2025, a 20 per cent increase over 2024.
“The world cannot have a China with a US$1.2 trillion trade surplus,” Bessent said on Sunday in an interview with Reuters.
“In China, the economy is quite weak, and they are trying to export their way out of it, and they need to rebalance their economy.”
China on Monday pushed back on the trade allegations and Washington’s latest attempt to rally other G20 members over the issue.
“China never deliberately pursues a trade surplus and opposes unilateral tariff measures in all forms,” foreign ministry spokesman Guo Jiakun said at a press briefing in Beijing.
For its part, Washington has attempted to stem the flow of Chinese imports through a slew of measures, including tariffs, national security-based import bans, restrictions on Chinese companies and tighter scrutiny of Chinese goods entering the US.
According to figures from the US Trade Representative, goods trade between China and the US totalled an estimated US$414 billion in 2025, down around 28 per cent from 2024.
Economists say this might be deceptive, however, as more Chinese goods are routed through third countries.
China denies industrial overcapacity due to state subsidies, weak domestic demand
Last month, China rejected claims that its industrial overcapacity was driven by state subsidies and weak domestic demand, saying its manufacturing strength instead reflected technological innovation, market competition and structural reforms.
“There is no necessary connection between industrial subsidies and overcapacity,” the commerce ministry said in a position paper.
The document argued that governments routinely use subsidies to advance domestic development goals, citing Washington’s US$750 billion Inflation Reduction Act passed in 2022 to support domestic EV production.
“It is imperative that all countries make the pie of global development bigger and introduce subsidies and other industrial policies in a rational and compliant manner, rather than use them as a tool to constrain the development of others,” it added.
The US focus on trade imbalance at the G20 comes as Washington and Beijing race to finalise the economic deliverables for the expected Trump-Xi meeting in Washington next month.

One major outcome is the likely launch of the bilateral Board of Trade, which will identify non-sensitive sectors and products the two sides can trade at reduced tariffs, capped at US$30 billion for each side.
The South China Morning Post reported last week that the bilateral trade truce agreed in Busan, South Korea, in October 2025, is likely to be extended.
The two sides at the time agreed to reduce some US tariffs on Chinese goods, suspend additional US restrictions on Chinese-affiliated companies, pause certain Chinese rare earth export controls for a year, and secure Chinese commitments on American soybeans and fentanyl precursors.
On the sidelines of the G20 ministerial, Bessent held a meeting with the People’s Bank of China Governor Pan Gongsheng on Sunday.
“I had a very robust meeting with Governor Pan last night,” Bessent told CNBC on Monday, without providing details of the discussions.
The Chinese G20 delegation also includes Chinese Vice Minister of Finance Liao Min.
US ramps up efforts to economically isolate Iran
The meeting comes as the US steps up efforts to build global support for its latest campaign to isolate Iran through tougher economic restrictions and secondary sanctions.
Last week, Bessent announced the administration’s “Economic D-Day” sanctions targeting 60 individuals and entities, including Hong Kong companies and Chinese nationals, but stopped short of targeting Chinese banks doing business with Iranian firms.
On Monday, he indicated that secondary sanctions against them may not be on the cards and questioned the assertion that economic pressure on Iran could not work without China’s help.
“I would push back on that false narrative that somehow the media has jumped on this. Oh, you can’t do it without China. Well, you can,” Bessent said, claiming that only 30 million barrels of Iranian oil are left on the open waters because of a US-led blockade. “So even if they were to get remittances from China, that’s going to run out.”
Bessent added that Washington and Beijing had “more in common” than they disagreed on Iran, noting that both countries agree that Iran cannot have a nuclear weapon and that the Strait of Hormuz must remain open to free and fair ship transit.
China last week condemned US actions and said Beijing’s cooperation with Tehran was conducted “within the framework of international law and should not be disrupted”.
Economic wars and maximum pressure were “not the solutions”, Chinese foreign ministry spokesman Lin Jian said.
China is the biggest buyer of Iranian oil, purchasing more than 80 per cent of the country’s total oil exports in 2025, according to data from analytics firm Kpler.