In 2025, the U.S. recorded a $1.24 trillion goods trade deficit. The biggest deficits were with China, Mexico and Vietnam, followed by Taiwan and Ireland.
China remained the biggest single source of the U.S. goods trade deficit, at about $202 billion. However, this was a big change from 2024, when the deficit with China was about $295 billion. The U.S. deficit with China fell by more than $93 billion in one year, mainly because American imports from China dropped sharply.
At the same time, the trade gap with several other countries became much larger. The U.S. trade deficit with Vietnam reached $178.2 billion, while the deficit with Taiwan nearly doubled to $146.8 billion. This shows that even as the U.S. bought less from China, a large share of its imports continued to come from other Asian manufacturing centers.
Key Takeaways
- China had the largest U.S. goods trade deficit in 2025, at $202.1 billion, despite a large drop from $295 billion in 2024.
- Mexico and Vietnam were close behind, with deficits of $196.9 billion and $178.2 billion.
- Taiwan recorded one of the biggest increases, where its U.S. trade deficit increased almost twofold to $146.8 billion.
The Countries Behind America’s Biggest Trade Deficits
The data is sourced from the U.S. Census Bureau, and the following table shows the U.S. trade deficit with its major trading partners in 2025, along with the 2024 figures and year-over-year change.
| Rank | Country | 2025 Deficit | 2024 Deficit | Change |
|---|---|---|---|---|
| 1 | 🇨🇳 China | $202.1B | $295.5B | -31.60% |
| 2 | 🇲🇽 Mexico | $196.9B | $171.5B | 14.80% |
| 3 | 🇻🇳 Vietnam | $178.2B | $123.5B | 44.30% |
| 4 | 🇹🇼 Taiwan | $146.8B | $73.7B | 99.10% |
| 5 | 🇮🇪 Ireland | $114.2B | $86.5B | 32.00% |
| 6 | 🇩🇪 Germany | $73.0B | $84.7B | -13.70% |
| 7 | 🇹🇭 Thailand | $71.9B | $45.5B | 58.00% |
| 8 | 🇯🇵 Japan | $63.9B | $69.4B | -7.90% |
| 9 | 🇮🇳 India | $58.2B | $45.8B | 27.10% |
| 10 | 🇰🇷 South Korea | $56.4B | $66.0B | -14.50% |
| 11 | 🇨🇦 Canada | $46.4B | $62.0B | -25.20% |
China: $202 Billion Deficit
In 2025, US had the largest trade deficit with China. The merchandise trade deficit between the United States and China decreased to $202.1 billion in 2025 from $295.5 billion in 2024, representing a reduction of about 31%.
The major factor contributing to this decrease was the reduction of U.S. imports from China. As reported by the U.S. government, the imports from China reduced by more than $130 billion in 2025.
Mexico: $196.9 Billion Deficit
Mexico was the second-largest source of the U.S. merchandise trade deficit in 2025, at about $196 billion. This trade deficit was actually higher than that recorded in 2024, which was $171.5 billion. That means the gap increased by about 14.8%.
Mexico has become increasingly important to U.S. supply chains. American companies import large amounts of manufactured goods, vehicles, machinery and other products from Mexico, while Mexico also buys a large amount of goods from the United States.
Vietnam: $178 Billion Deficit
Vietnam recorded the third-largest U.S. goods trade deficit, at $178.2 billion. That was a sharp increase from $123.5 billion in 2024. The deficit grew by about 44.3% in just one year.
As tariffs made buying directly from China more expensive, a lot of manufacturing and sourcing shifted to Vietnam instead. American imports from Vietnam rose sharply as a result, making it one of the fastest-growing sources of the U.S. trade gap.
The U.S. importation of goods from Vietnam increased significantly in 2025. Vietnam is now an essential manufacturing base for products that are exported to Americans, becoming a rapidly growing source of America’s trade deficit.
Taiwan: $146.8 Billion Deficit
The trade deficit of the United States with Taiwan amounted to $146.8 billion in 2025, which was an increase from $73.7 billion in 2024. This is practically a double increase in just one year.
Part of the story here is semiconductors. Taiwan is the world’s leading source of advanced computer chips, and U.S. companies ramped up chip purchases hard in 2025 to keep up with the ongoing AI buildout.
The increase in deficit was primarily due to the high increase in imports into the United States from Taiwan. The imports increased by more than $85 billion, whereas the exports increased by approximately $12 billion. The significance of Taiwan cannot be underestimated considering its importance in technology and semiconductors.
Ireland: $114.2 Billion Deficit
Another significant contributor to the trade deficit for the United States was ireland, with a deficit value of $114.2 billion in 2025. This represents a rise from a figure of $86.5 billion in 2024, an increase of roughly 32%.
Ireland’s surplus isn’t built on factory floors and assembly lines. It comes largely from pharmaceuticals and other high-value goods that many U.S. and multinational drug companies produce there for tax and manufacturing reasons.
Germany: $73 Billion Deficit
In 2025, the United States had a merchandise trade deficit with Germany that amounted to $73 billion. In fact, this number decreased from $84.7 billion in 2024. That represents a decline of about 13.7%.
Germany remains one of America’s biggest trading partners in Europe, with automobiles, machinery and industrial products playing an important role in bilateral trade.
Thailand: $71.9 Billion Deficit
The U.S. trade deficit with Thailand reached $71.9 billion in 2025. This represented a sharp rise from the deficit of $45.5 billion incurred in 2024. The deficit rose by 58%.
Like Vietnam, Thailand has become another landing spot for manufacturing that used to happen in China, adding to the broader shift of America’s trade gap toward Asia.
Japan: $63.9 Billion Deficit
Japan had a deficit of $63.9 billion in U.S. merchandise trade in 2025. The amount represented a drop from $69.4 billion seen in 2024, indicating a reduction of about 7.9%. Japan is a significant trading partner with the U.S., especially in automobile trade.
India: $58.2 Billion Deficit
In 2025, the United States had a trade deficit for goods with India worth $58.2 billion. This deficit rose from $45.8 billion in 2024, showing an increase of roughly 27.1%.
This rising deficit is due to the increasing imports of goods from India by the United States despite the lack of growth in American exports to India.
U.S. Trade Deficit with China Hits $1.6 Trillion Over Five Years (2020-2024)
South Korea: $56.4 Billion Deficit
The U.S. trade deficit with South Korea stood at $56.4 billion in 2025. Interestingly, the deficit was smaller than the $66 billion recorded in 2024. It declined by about 14.5%.
South Korea remains a major supplier of automobiles, electronics, machinery and other manufactured products to the U.S. market.
Canada: $46.4 Billion Trade Deficit
In 2025, the United States reported a goods trade deficit of $46.4 billion with Canada. This figure represents a marked reduction from $62 billion in 2024, representing a fall of approximately 25%.
Canada is among the biggest trading partners of the United States, and there are deep links between their supply chains. Goods like energy, vehicles, machinery, and others comprise a substantial portion of their trade.
Switzerland: $34.3 Billion Trade Deficit
In 2025, the trade deficit of the U.S. with Switzerland stood at $34.3 billion. This figure represented a reduction from the $38.3 billion trade deficit in 2024.
While Switzerland is a small nation in comparison to many of the biggest trading partners of the United States, there exists an important trade relationship between the two nations.
Malaysia: $30.8 Billion Deficit
The trade deficit between the U.S. and Malaysia was $30.8 billion in 2025. The figure is a significant increase from $24.9 billion in 2024, which is an increase of about 23.9%. Malaysia is another major manufacturer of products in Asia, especially electronics.
Italy: $30.8 Billion Deficit
The trade deficit between the U.S. and Italy in 2025 was $30.8 billion. The trade deficit was significantly lower than that of 2024, which was $44 billion. This is a decrease of 30.1%.
Italy exports various goods to the U.S., including machinery, vehicles, drugs, food items, and luxury goods.
Regional Analysis
China, Vietnam, Taiwan, Thailand, Japan, India, South Korea, Malaysia, and Indonesia together added up to about $832 billion of the U.S. trade deficit in 2025. North America came in next, with Mexico and Canada together accounting for roughly $243 billion, most of it from Mexico alone.
Europe followed close behind at around $252 billion, led by Ireland’s pharmaceutical-heavy trade and smaller contributions from Germany, Switzerland, and Italy. The pattern is pretty clear: Asia is where the bulk of America’s manufacturing and electronics imports come from, and that’s exactly where the trade gap keeps growing the fastest, especially as buying shifted away from China toward its neighbors.
The Bottom Line
America’s trade deficit is not about one country alone. China remained the biggest source of the U.S. goods trade deficit in 2025, but its lead became much smaller. At the same time, deficits with Mexico, Vietnam and Taiwan grew sharply.
This is one of the most important changes in the U.S. trade picture. This is possible since American businesses and people will be purchasing less products from China. Therefore, in effect, decreasing the deficit with any single country does not automatically solve the issue of America’s total deficit in trade.
The United States’ goods deficit reached $1.24 trillion in 2025 even though the total deficit for both services and goods stood at around $901.5 billion because there was a big surplus of services.
