China’s exports rise, but falling imports dampen June trade data
CHINA’S exports rose 8.6 per cent in June from a year earlier, and imports unexpectedly shrank 2.3 per cent, customs data showed on Friday (Jul 12), suggesting manufacturers are front-loading orders in anticipation of tariffs from a growing number of trade partners.
A Reuters poll of economists had forecast exports would grow 8 per cent by value and imports would rise 2.8 per cent, compared with 7.6 per cent and 1.8 per cent, respectively, in the previous month.
Stronger-than-expected exports have been one of the few bright spots for an economy otherwise still struggling for momentum, despite official efforts to stimulate domestic demand following the Covid-19 pandemic.
A prolonged property slump and worries about jobs and wages are weighing heavily on consumer confidence.
Still, as the number of countries considering stepping up curbs on Chinese goods increases, so, too, does the pressure on its exports to prop up progress towards the government’s economic growth target for this year of around 5 per cent.
China’s trade surplus grew to US$99.1 billion, compared with a forecast of US$85 billion and US$82.6 billion in May. The US has repeatedly highlighted the surplus as evidence of one-sided trade favouring the Chinese economy.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
In May this year, Washington hiked tariffs on an array of Chinese imports, including quadrupling duties on Chinese electric vehicles (EVs) to 100 per cent. Last week, the European Union confirmed it would impose tariffs on EVs as well, but only up to 37.6 per cent.
Chinese exporters are also on edge heading into the US presidential election in November, in case either major party tips fresh trade restrictions.
Turkey last month announced it would impose a 40 per cent additional tariff on Chinese-made EVs, and Canada said it was considering curbs.
SEE ALSO
Meanwhile, Indonesia plans to impose import duties of up to 200 per cent on textile products, which come mainly from China; India is monitoring cheap Chinese steel; and talks with Saudi Arabia over a free trade agreement have reportedly stalled over dumping concerns.
Analysts expect China to roll out more policy support measures in the short term, and a government pledge to boost fiscal stimulus is seen helping kick domestic consumption into a higher gear.
Economists and investors are awaiting for the Third Plenum to be held from Jul 15 to 18, with hundreds of China’s top Communist Party officials gathering in Beijing for a meeting that comes every five years. REUTERS
Share with us your feedback on BT's products and services
