China's Digital Exports Skyrocket as Tech Giants Expand Global Footprint
Chinese revenue from digital services sold abroad is experiencing a dramatic surge as leading technology champions, including ByteDance Ltd. and Tencent Holdings Ltd., aggressively ramp up their overseas operations in key sectors such as live streaming, e-commerce, and artificial intelligence. This expansion highlights a strategic shift towards international markets amid intense domestic competition and sluggish demand at home.
Record Trade Surplus in Digital Services
The trade surplus from digital services, which encompasses a broad range of businesses from telecom operations to cloud computing, more than doubled in 2025 to an unprecedented $33 billion, according to data from the State Administration of Foreign Exchange. Specifically, the category of telecom, computer, and information services, which includes AI technologies, expanded by nearly 30% last year, based on Bloomberg's calculations derived from balance of payments data.
This significant increase underscores a growing urgency among Chinese tech firms to seek growth opportunities beyond the world's second-largest economy. With profitability under pressure due to fierce domestic rivalry and lackluster consumer demand, companies are turning their focus to international expansion to sustain their momentum.
Leading Players and Global Operations
Alibaba Group Holding Ltd., Tencent, and ByteDance dominate China's digital exports, operating through well-known platforms like Lazada in e-commerce and TikTok in social networking. Their efforts are further propelled by US export restrictions on high-end chips, which have prompted Chinese AI developers to establish overseas data centers for easier access to more advanced technology.
Alibaba and its competitors manage extensive computing platforms that primarily serve the international operations of Chinese firms. Tencent's cloud facilities, for instance, span from Silicon Valley to Riyadh and Singapore, supporting essential services such as video conferencing and gaming. Meanwhile, ByteDance is making a substantial $38 billion investment in an AI-related data center in Brazil, marking its latest push into South America after years of gradual expansion across Europe, the United States, and Southeast Asia.
Driving Factors and Broader Impact
The overseas growth of Chinese companies in sectors like electric vehicles, renewable energy, and manufacturing is further amplifying the demand for digital services abroad. These enterprises require offshore data processing and storage solutions, boosting the need for Chinese cloud providers, including state-backed telecom operators, Huawei Technologies Co., Alibaba, and Tencent.
SAFE's data, which does not provide company-level details, covers cross-border money transactions between domestic and overseas firms and excludes income that is not remitted back to China. A net surplus in this context reflects net inflows, indicating a positive balance for the country's digital services trade.
Context and Global Standing
China's overall trade surplus reached a record $1.2 trillion in 2025, driven by a rapid increase in exports. However, the country's services trade had previously been in deficit for years. In response, Beijing has committed to finding ways to assist Chinese companies in exporting services, particularly digital and AI-powered offerings.
Software and data represent one of China's few strong suits in the global market. According to the International Monetary Fund classification, which covers cross-border activities like data transmission, cloud computing, and software development, China ranks as the world's fourth-largest provider of telecom, computer, and information services. India holds the top position in this category, supported by its vast software outsourcing industry.
This surge in digital exports not only highlights the competitive edge of Chinese tech giants but also signals a transformative phase in global trade dynamics, with AI and digital services becoming increasingly pivotal in economic growth strategies.
