Economy September 2, 2026 08:06 AM

China Says It Does Not Seek Trade Surplus, Urges Domestic Demand and Openness

Central bank governor tells G20 meeting structural reform needed on both deficit and surplus sides as protectionism fuels imbalances

By Sofia Navarro
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China's central bank governor told the G20 Finance Ministers and Central Bank Governors meeting that Beijing does not intentionally aim for a trade surplus and will pursue greater domestic demand alongside continued openness. The governor attributed worsening global trade imbalances to rising protectionism, the broad application of national security concerns and unpredictable policy, and called for structural reforms across countries to address the issue.

China Says It Does Not Seek Trade Surplus, Urges Domestic Demand and Openness
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Key Points

  • China's central bank governor said Beijing does not intentionally pursue a trade surplus and will expand domestic demand while maintaining high openness.
  • G20 talks concluded after two days in the United States; the G20 chair's statement noted all participants except China agreed to eliminate 'non-market policies' that worsen imbalances.
  • Pan Gongsheng urged structural reforms: deficit countries should reduce fiscal deficits and raise savings, while surplus countries should boost consumption and investment; he blamed rising protectionism, wider use of national security arguments and unpredictable policy for worsening global imbalances.

BEIJING, Sept 2 - China does not deliberately target a trade surplus and remains committed to expanding domestic demand while keeping a high degree of openness to the global economy, the country's central bank said in a statement summarising remarks to the G20 Finance Ministers and Central Bank Governors meeting.

The two-day meeting held in the United States concluded on Tuesday. In a G20 chair's statement, the participating members - with the exception of China - agreed that countries should eliminate what they described as "non-market policies" that worsen imbalances.

The central bank's statement quoted Governor Pan Gongsheng as saying that global trade imbalances require structural reforms in all countries. Pan set out measures for both sides of the ledger: deficit countries should reduce fiscal deficits and raise domestic saving rates, while surplus countries should work to stimulate consumption and investment growth.

China reported a record trade surplus of nearly $1.2 trillion in 2025, a figure that has unsettled trading partners and prompted calls for stronger steps to protect domestic industries from a surge in Chinese imports. The central bank's account of Pan's remarks linked recent deterioration in global economic balance to several factors, including increasing trade protectionism, the generalisation of national security issues and the rise of unpredictable policy actions.

Pan also said that trade frictions and protectionist measures have harmed the global economy by disrupting supply chains, pushing up inflation and unsettling market expectations, according to the central bank statement.


Context and emphasis

The central bank highlighted the need for coordinated structural reform across deficit and surplus countries to address the imbalances that have grown in recent years. Its account of Pan's remarks placed equal weight on policy adjustments at both ends of the trade spectrum, urging fiscal consolidation and higher saving in deficit economies and stronger consumption and investment in surplus economies.

What was agreed at the meeting

  • The G20 meeting concluded after two days of discussions in the United States.
  • The G20 chair's statement indicated broad agreement among participants - except China - on the need to remove policies described as non-market that exacerbate imbalances.
  • China reaffirmed its commitment to opening up while signalling domestic demand expansion as a policy priority.

Observations from the central bank statement

According to the central bank's summary of Pan Gongsheng's remarks, the recent surge in protectionist tendencies and the broader invocation of national security have been central drivers behind the worsening global trade picture. Those dynamics, paired with unpredictable policy moves, were said to have dampened global activity by affecting supply chains, raising inflationary pressures and disrupting market expectations.

Risks

  • Rising trade protectionism and broader use of national security concerns - this can impact global supply chains and sectors reliant on cross-border manufacturing and logistics.
  • Unpredictable policy actions - these can disrupt market expectations and increase volatility in financial markets and trade-sensitive industries.
  • Persistent large trade surpluses - such imbalances may prompt trading partners to adopt protective measures that could affect exporters and import-competing industries.

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