Tue, Jun 11, 2019 - Page 10 News List

China’s exports beat forecast, rising as tariffs loom

ABERRATION?Analysts said that despite the rebound in Chinese exports last month, the trade outlook for the country is likely to suffer, because of the turbulence ahead


China’s exports beat gloomy forecasts to rebound last month, although imports sank more than expected, official data showed yesterday, as concerns lingered about the effects of its ongoing trade dispute with the US.

The spat between the world’s top two economies escalated last month, with US President Donald Trump increasing tariffs on US$200 billion in Chinese goods.

However, Chinese exports to the world bounced back to rise 1.1 percent last month after falling 2.7 percent in April, according to customs data.

Analysts surveyed had forecast a 3.9 percent drop, but imports plummeted 8.5 percent, after rising 4.0 percent in April.

The trade surplus surged to US$41.7 billion last month from US$13.8 billion in April. The politically sensitive surplus with the US was US$26.9 billion, up from US$21 billion in April.

Trade talks between Beijing and Washington have stalled while the two countries have threatened to slap more sanctions on each other.

Trump is expected to meet Chinese President Xi Jinping (習近平) at the G20 summit in Japan at the end of the month.

US Secretary of the Treasury Steven Mnuchin said at a G20 meeting of finance ministers on Saturday that any potential deal with China would wait until the two nation’s leaders meet later this month, but Washington was ready to impose new tariffs if talks fail.

Analysts said that despite the rebound in exports, China’s trade outlook is likely to suffer, because of the turbulence ahead.

“While exports rose in May, weaker global demand and the escalating trade war suggest that they will start to fall again before long,” Capital Economics senior economist Marcel Thieliant said in a note.

Others attributed the bounce last month to exports being scheduled so that they are shipped ahead of when tariffs kick in, pointing to a likely drop later in the year.

“The better-than-expected exports in May, which could have been helped by a depreciation in ... [the yuan] and front-loading of shipments amid fears of higher US tariffs, do not change our overall cautious view on China’s export look for 2019,” Australia and New Zealand Banking Group Ltd senior China economist Betty Wang (王蕊) said in a note.

The export turbulence ahead could prompt Beijing to intervene and stimulate the economy.

The growth of China’s exports should “tumble in Q3, when we expect the threatened tariffs to be imposed,” Nomura International said in a note.

“We believe Beijing is to step up its stimulus measures to stabilize financial markets and growth,” Nomura International added.

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