Chinese exports to Hong Kong rose 10.8 percent from a year earlier for the biggest gain in more than a year, making the territory the biggest destination for shipments last month and spurring renewed skepticism over data reliability and the broader recovery in China’s outbound trade.
Exports to Hong Kong rose to US$46 billion last month, according to data released by China’s General Administration of Customs yesterday. That was the highest value in almost three years and the biggest amount for any December in the past 10 years, customs data showed. Imports from Hong Kong surged 65 percent, the most in three years, to US$2.16 billion.
Economists said the surprise gains might harken back to past instances of phony invoicing and other rules skirted to escape currency restrictions. Beijing said in 2013 that some data on trade with Hong Kong were inflated by arbitrage transactions intended to avoid rules, an acknowledgment that export and import figures were overstated.
The increase in exports to Hong Kong and China’s imports from the territory probably indicate “fake invoicing,” said Iris Pang, a senior economist for Greater China at Natixis SA in Hong Kong. Invoicing of China trade should have been larger last month because of the wider gap between the onshore yuan and the offshore yuan traded in Hong Kong, she said.
China’s exports to the Special Administrative Region of more than 7 million people eclipsed the US$35 billion tallies last month for both the US and the EU, the data showed. Exports to Brazil, Canada, Malaysia and Russia all dropped more than 10 percent.
The imports gain “points to potential renewed fake trade activities,” said Larry Hu (胡偉俊), head of China Economics at Macquarie Securities Ltd in Hong Kong.
When the yuan rose in 2013, exports to Hong Kong were inflated artificially, he said, and “now it’s just the opposite.”
China’s total exports rose 2.3 percent in yuan terms from a year earlier, the administration said, after a 3.7 percent drop in November. Imports extended declines to 14 months.
The recovery in exports last month might prove to be a temporary one due to a seasonal increase at the end of the year, and it does not represent a trend, a customs spokesman said after yesterday’s briefing. A weak yuan is expected to help exports, but that effect would gradually fade, the spokesman told reporters in Beijing.
Morgan Stanley economists, led by Zhang Yin (張胤) in Hong Kong, also said in a note yesterday that the higher-than-expected trade growth might have been affected by currency arbitrage. Overall external demand remained weak, as shown by anemic export data reported by Taiwan and South Korea, he said.
Because enforcement efforts on irregular capital outflows have been stepped up recently and the spread between the onshore and offshore yuan has narrowed, “the potential distortion will likely dissipate in the coming months,” the analyst said.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last