Keep knowledgeable with free updates
Merely signal as much as the Chinese language commerce myFT Digest — delivered on to your inbox.
Chinese language exports rose 5.8 per cent yr on yr in greenback phrases in June, beating expectations as firms used a tariff truce with the US to ship items forward of an August deadline for a extra definitive deal.
The sturdy trade figures launched on Monday got here forward of this week’s GDP information for the second quarter that can also be anticipated to please Beijing, as policymakers search to stimulate a weak home financial system whereas navigating geopolitical turmoil.
However the first-half commerce information might sway the Trump administration to tighten its tariff noose on China and the south-east Asian international locations that it accuses of allowing transshipment, or rerouting Chinese language items to the US.
China’s June export development beat a 5 per cent rise predicted by analysts in a Reuters ballot in addition to 4.8 per cent growth in May.
Imports final month rose 1.1 per cent on a yr earlier in {dollars}, weaker than analysts’ forecasts of 1.3 per cent however reversing a 3.4 per cent decline in Might and marking the primary enlargement since December.
“The short-term tariff reprieve granted on the US-China emergency commerce talks . . . has given Chinese language exporters some respiration house, with rising frontloading demand,” Kelvin Lam, senior China+ economist at Pantheon Macroeconomics, wrote in a observe.
The US and China agreed in London to scale back their tariffs from ranges as excessive as 145 per cent whereas they negotiate reduction from export restrictions on Chinese language uncommon earths and US superior expertise akin to semiconductors. Late final month, Trump mentioned the perimeters had “signed” a trade deal to formalise that truce.
Chinese language President Xi Jinping’s authorities has relied on exports to spice up GDP development at a time when home consumption has lagged behind amid a protracted property sector slowdown.
Beijing has additionally invested heavily in manufacturing to attempt to meet its GDP goal for this yr of about 5 per cent. Analysts have predicted that China on Tuesday will report second-quarter GDP development in extra of that concentrate on, at about 5.1 per cent yr on yr.
China’s benchmark CSI 300 index of Shanghai- and Shenzhen-listed shares rose 0.1 per cent on Monday, whereas the renminbi was flat at Rmb7.17 per greenback.
Whereas Beijing didn’t instantly launch dollar-denominated figures for commerce with particular person international locations, exports to the US fell 9.9 per cent yr on yr in renminbi phrases between January and June, whereas its imports declined 7.7 per cent.
Exports to Russia dropped 7.4 per cent over the identical time period, whereas imports decreased 8.6 per cent.
Exports to the EU, in the meantime, rose 7.9 per cent within the first half of the yr in renminbi phrases whereas imports dropped 4.8 per cent.
The rise comes ahead of a summit subsequent week in Beijing between European Fee President Ursula von der Leyen and President Xi at which the bloc is predicted to precise its concern concerning the diversion of Chinese language merchandise to its markets.
Exports to international locations within the Affiliation of Southeast Asian Nations, which the US accuses of transshipment of Chinese language exports, rose 14.3 per cent, whereas imports elevated 2.3 per cent within the first half.
Economists additionally pointed to a trade agreement between the US and Vietnam that features a 40 per cent tariff on transshipped items, which Pantheon’s Lam mentioned was “clearly aimed toward Chinese language exporters and designed to additional isolate China from international provide chains”.
Yuhan Zhang, principal economist at The Convention Board’s China Middle, mentioned China’s general first-half commerce surplus was pushed by weak imports and resilient exports, reflecting efforts to diversify export markets.
“Exports of robots have elevated considerably, indicating China’s sturdy home industrial insurance policies in superior manufacturing, its technique of diversifying export markets, and the international expertise pattern and exterior demand,” Zhang mentioned.
He added that China was diversifying its commerce geographically, boosting exports to south-east Asia, Africa, central Asia and the EU whereas shipments to the US declined.
“Tariffs and geopolitical tensions will probably be a drag by late 2025 except offset by new stimulus and diversification,” he mentioned.
Knowledge visualisation by Haohsiang Ko in Hong Kong
