UBS has raised its outlook for China’s 2026 trade performance after tracking a stronger-than-anticipated start to the year, attributing much of the momentum to commerce tied to artificial intelligence-related products and services.
According to the bank, China’s exports climbed 18% year-over-year in the first half of 2026, while imports jumped 26% over the same period. UBS says AI-related trade accounted for nearly half of the expansion in both exports and imports during the first six months, underscoring the rapid rise of that segment within cross-border flows.
UBS notes that the recent gains have been driven more by price increases than by higher volumes. The bank links this pricing strength to an undersupplied market and to product upgrading among exporters. Much of the AI-linked activity is concentrated with neighboring economies in the region, supporting elevated levels of both inbound and outbound trade.
Looking beyond AI, UBS reports that non-AI exports still recorded solid growth, rising 11% year-over-year in the first half. That increase was largely propelled by shipments of greener technologies and equipment - including batteries, solar apparatus and power equipment - as well as higher vehicle deliveries, led by electric and hybrid models. Consumer goods exports did not keep pace with these segments.
On the import side, non-AI goods surged 19% year-over-year, with gold, oil and other commodities cited as the main drivers. UBS emphasizes that these import gains were supported predominantly by rising prices rather than by an accelerated volume intake, and the bank expects that price-related support to wane later in 2026.
Following the first-half outturn, UBS has adjusted its full-year forecasts. The bank now projects nominal exports to grow roughly 18% in 2026 in U.S. dollar terms, and it has lifted its import forecast to 24% for the year. The upward revision to imports reflects an expectation that strong AI-related export activity will pull in associated intermediate and capital goods, even as non-AI imports may ease if commodity price growth slows.
When stripping out price effects, UBS calculates that net exports are set to contribute 0.8 percentage points to real GDP growth in 2026, a smaller contribution than the 1.6 percentage points recorded in 2025.
UBS also points to price dynamics across trade: export prices began to recover in 2026 after having fallen 17% over the prior three years, a rebound led by technology products and domestic reflationary forces. Import prices have been rising even faster, a development that has further eroded China’s terms of trade.
Finally, UBS highlights that the renminbi has remained relatively resilient through this period, with the People’s Bank of China permitting a gradual appreciation.
Key points
- AI-related trade accounted for almost half of China’s export and import growth in H1 2026, supporting both inbound and outbound flows - impacts sectors: technology, semiconductors, and regional trade corridors.
- UBS now forecasts 2026 nominal export growth of about 18% and import growth of 24%, driven by price strength and AI-related activity - impacts sectors: manufacturing, commodities, and transport/logistics.
- Non-AI gains concentrated in green technologies and auto shipments, while consumer goods lagged - impacts sectors: renewables, automotive, consumer goods exporters.
Risks and uncertainties
- Price-driven growth may prove temporary if the projected price tailwind fades later in 2026, potentially reducing import-driven gains - sectors at risk: commodities and import-dependent manufacturing.
- The stronger rise in import prices relative to export prices is eroding China’s terms of trade, which could weigh on real income and trade balances - sectors at risk: trade-sensitive industries and commodity users.
- Because much of the recent expansion stems from prices rather than volumes, the durability of trade-driven GDP contributions is uncertain - sectors at risk: freight and logistics providers that rely on volume growth.