Wednesday , February 24 2021

Chinese exports to the US wave are growing as tariffs rise, Business News & Top Stories

BEIJING • China exports to the United States and the rest of the world recorded a surprise last Wednesday, data show yesterday, suggesting companies spread transpacational shipments before withdrawing high tariffs.

Relations between the two world's largest economies have jumped sharply this year, as US President Donald Trump hit more taxes on roughly half of China's imports and threatened to stay in the second half.

Main Chinese officials are currently in Washington, hoping these talks will open the way for trade breakdown this month when Mr Trump meets Chinese President Xi Jinping at the G-20 Summit in Argentina.

Still, exporters continued to rush goods over the Pacific Ocean last month, with China exports to the US up 13.2 percent over the same period last year, according to data released by the Chinese Customs Administration.

"It looks like the surprisingly strong export performance in October is partly a consequence of the continued impact of the front impact and is unlikely to be a long-term trend," said Chinese economist Betty Wang at ANZ.

China's trade surplus with the US dropped to $ 31.8 billion ($ 43.6 billion) last month, with record $ 34.1 billion in September.

October marked the first full month US tariffs of $ 200 billion of Chinese commodities – but the tax rate was set to jump from 10 to 25 percent in January.

Mr. Trump has repeatedly praised that the US can not lose a trade war with China, but the Beijing rebate tariff for US goods is even worse for trade so far.

China's imports from the US declined 1.8 percent last month for a year, while its surplus with the US expanded to $ 258 billion for the first 10 months of this year.

The decline in the yuan, which in relation to the US dollar jumped by about 9 percent compared to the January surplus, helped to compensate for additional tariffs on Chinese products.

Analysts are not optimistic that an upcoming meeting of two state leaders will solve friction.

"We do not expect the Xi-Trump meeting during the G-20 to be positive," Iris Pang of ING Bank for Bloomberg News said.

"We just hope that the meeting will not create further damage to the trade relationship."

Chinese general trade – what it buys and sells with all countries, including the United States – has surpassed $ 34 billion for that month.

Exports jumped by 15.6 percent in October last year, pushing Bloomberg News's forecast for 11.7 percent, while imports rose 21.4 percent a year, well above forecasts for 14.5 percent.

"While shipments to the United States were well-built, those in other parts of the world grew even faster," said Mr. Louis Kuijs of Oxford Economics.

"Global demand may be worse than fear, and the weaker Chinese yuan will also help the country's exporters."

Robust imports have shown that the Chinese economy remained stable despite the growth of 6.5 percent of gross domestic product in the third quarter – the slowest in nine years.

Beijing could be pushed out of its campaign to deal with growing debt, which has been severely affected by growth, analysts say.

"Robust imports, especially commodities, could be a sign of a jump in infrastructure investment and real estate market stabilization," said Ms. ANZ.

Despite the resilient trade data, analysts predict that the US-China counterattack will hit growth in the coming months.


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