In foreign trade, if a country's exports exceed its imports within a certain period of time (usually one year), it is called surplus, that is, trade surplus, which shows that a country has net foreign exchange income, increased foreign exchange reserves, and its goods are highly competitive internationally and in a favorable position in the international market; If the import volume is greater than the export volume, it is called excess, that is, trade deficit, or trade deficit. It shows that a country's foreign exchange reserves are decreasing, its international competitiveness is weak and it is at a disadvantage in the international market.

trade surplus

The development of a country's foreign trade is mainly based on the foreign trade balance table regularly published by the government. Generally speaking, the balance sheet contains statistical data showing exports and imports systematically, which can generally reflect a country's foreign trade and even national economic development in a specific period. A country's foreign trade constitutes a trade surplus, a trade deficit or a trade balance according to the situation that exports are greater than, less than or equal to imports.

1. Trade surplus. The so-called trade surplus means that a country's total export trade in a specific year is greater than its total import trade, also known as "surplus", which means that the country's foreign trade in that year is in a favorable position. The size of the trade surplus largely reflects a country's foreign trade activities in a specific year. Under normal circumstances, it is not appropriate for a country to maintain a large foreign trade surplus for a long time, because it is easy to cause friction with relevant trading partners. For example, one of the main reasons for the market fluctuation of bilateral relations between the United States and Japan is that Japan has been in a huge surplus for a long time. At the same time, a large amount of foreign exchange surplus usually leads to the increase of local currency in a country's market, which is easy to cause inflationary pressure and is not conducive to the sustained and healthy development of the national economy.

2. Trade deficit. The so-called trade deficit means that a country's total import value is greater than its total export value in a specific year, commonly known as "over-import", which reflects that the country was at a disadvantage in foreign trade that year. Similarly, a government authority should try to avoid a long-term trade deficit, because a huge deficit will lead to the outflow of domestic resources and the increase of foreign debt. This situation will also affect the normal operation of the national economy.

3. Trade balance. Trade balance means that a country's total foreign trade import and export volume tends to be basically balanced in a specific year. Looking at the practice of foreign trade policies of governments around the world, this phenomenon is not much. Generally speaking, a government should try its best to keep a basic balance between imports and exports in foreign trade, with a slight surplus, which is conducive to the healthy development of the national economy.

Therefore, if the surplus and deficit are not good for a long time, balance is the best.