China announced on July 14 that its trade surplus reached $586 billion in the first half of this year, as exports regained momentum in June following the de-escalation of trade tensions with the United States.
Outbound shipments climbed by 5.8 percent from a year earlier in June, up from May’s 4.8 percent increase, according to data released by China’s General Administration of Customs. The result beat the 5 percent growth expected by economists in a Reuters poll.
Imports climbed by 1.1 percent from a year earlier in June, reversing a 2.9 percent decline in May and marking the first growth so far this year, Chinese customs data show. Analysts had projected a slightly higher increase of 1.3 percent, according to Reuters.
Overall, during the first half of this year, the country exported $1.81 trillion worth of goods and services, while importing $1.22 trillion, according to Chinese customs data. The resulting surplus of $586 billion was nearly 35 percent higher than the $435 billion recorded last year.
The widening of the trade imbalance came at a time of heightened concern in Western economies about Chinese exports. The United States, the European Union, and other regions are worried about job losses and factory closures in sectors flooded with low-priced Chinese products.
Citing the trade imbalance and other reasons, U.S. President Donald Trump increased the tariffs on Chinese products to as high as 145 percent in April. In response, China retaliated by raising tariffs on U.S. goods to 125 percent, blacklisting dozens of American companies and tightening export controls on rare earth magnets and other strategic metals.
June marked the first full month after Beijing and Washington agreed to pause most of their tariffs for 90 days.
Exports to the United States fell by 16.1 percent in June from a year earlier, according to The Epoch Times’ calculation based on the latest Chinese customs data. This contraction followed a record 34.5 percent decline set in May.
Shipments to the Association of Southeast Asian Nations, or ASEAN, China’s biggest trading partners, rose by 16.8 percent in June from a year earlier, accelerating from a 14.8 percent increase in May.
Exports growth to the European Union, China’s second-largest trading partner, slowed to 7.6 percent in June from 14.7 percent in May.
“Growth in export values rebounded somewhat last month, helped by the US-China trade truce,” Zichun Huang, China economist at Capital Economics, said in a note on July 14.
“But tariffs are likely to remain high and Chinese manufacturers face growing constraints on their ability to rapidly expand global market share by slashing prices. We therefore expect export growth to slow over the coming quarters, weighing on economic growth.”
Exports have emerged as a vital growth engine for the world’s second-largest economy, which is still burdened by factors such as a prolonged real estate crisis, high youth unemployment, and weak consumption.
China is set to release the economic growth statistics for the second quarter on July 15. Analysts surveyed by Reuters predicted China’s economy to expand by 5.1 percent, down from 5.4 percent in the first quarter.
Meanwhile, the Trump administration is moving to curb transshipment, a tactic commonly used by Chinese factories to reroute shipments to the United States and evade tariffs.
The U.S. president recently announced a trade deal plan with Vietnam that includes a 20 percent tariff on Vietnamese exports to the United States, along with a 40 percent tariff on goods transshipped through Vietnam from other countries.
The latest China customs data show that the country’s exports to Vietnam increased by 23.8 percent in June from a year earlier.
