During the 1950s China's primary foreign trading partner was the Soviet Union. In 1959 trade with the Soviet Union accounted for nearly 48 percent of China's total. As relations between the two countries deteriorated in the early 1960s, the volume of trade fell, decreasing to only just over 7 percent of Chinese trade by 1966. During the 1970s trade with the Soviet Union averaged about 2 percent of China's total, while trade with all communist countries made up about 15 percent. In 1986, despite a trade pact with the Soviet Union, Chinese-Soviet trade, according to Chinese customs statistics, amounted to only 3.4 percent of China's total trade, while trade with all communist countries fell to 9 percent of the total (see table 18, Appendix A).

By the mid-1960s Japan had become China's leading trading partner, accounting for 15 percent of trade in 1966. Japan was China's most natural trading partner it was closer to China than any other industrial country and had the best transportation links to it. The Japanese economy was highly advanced in those areas where China was weakest, especially heavy industry and modern technology, while China was well endowed with some of the important natural resources that Japan lacked, notably coal and oil. In the 1980s Japan accounted for over 20 percent of China's foreign trade and in 1986 provided 28.9 percent of China's imports and 15.2 percent of its exports. Starting in the late 1970s, China ran a trade deficit with Japan.

Beginning in the 1960s, Hong Kong was consistently the leading market for China's exports and its second largest partner in overall trade. In 1986 Hong Kong received 31.6 percent of Chinese goods sold abroad and supplied about 13 percent of China's imports. Hong Kong was a major market for Chinese foodstuffs and served as a transshipment port for Chinese goods reexported to other countries.

The United States banned trade with China until the early 1970s. Thereafter trade grew rapidly, and after the full normalization of diplomatic and commercial relations in 1979, the United States became the second largest importer to China and in 1986 was China's third largest partner in overall trade. Most American goods imported by China were either high-technology industrial products, such as aircraft, or agricultural products, primarily grain and cotton.

Western Europe has been important in Chinese foreign trade since the mid-1960s. The Federal Republic of Germany, in particular, was second only to Japan in supplying industrial goods to China during most of this period. China followed a policy of shopping widely for its industrial purchases, and it concluded deals of various sizes with nearly all of the West European nations. In 1986 Western Europe accounted for nearly 18 percent of China's foreign trade, with imports exceeding exports.

Third World countries have long served as a market for Chinese agricultural and light industrial products. In 1986 developing countries purchased about 15 percent of Chinese exports and supplied about 8 percent of China's imports.

Data as of July 1987