China’s trade growth rebounded in May in a positive sign for global demand and the cooling Chinese economy.
In this April 17, 2017, photo, workers assemble a truck chassis at an automotive plant in Fuyang in central China’s Anhui province. China’s trade growth rebounded in May in a positive sign for global demand and the cooling Chinese economy.
Exports rose by a better-than-expected 8.7 percent over a year earlier to $190 billion, up from April’s 8 percent growth, customs data showed Thursday. Imports gained 14.8 percent to $150.2 billion, up from the previous month’s 11.9 percent.
Unexpectedly strong exports could lend support to economic growth that is forecast to weaken this year as Beijing tightens credit controls to reduce the risks of rising debt.
The data show “momentum in demand from the U.S. and the EU continues to improve,” said Louis Kuijs of Oxford Economics in a report.
Chinese leaders are trying to steer the country to self-sustaining growth based on domestic consumption and reduce reliance on trade and investment but want to avoid politically dangerous job losses in export-dependent industries.
Forecasters warned Chinese import demand is likely to wane as the economy cools. The International Monetary Fund expects this year’s economic growth to decline to 6.6 percent from last year’s 6.7 percent and to below 6.2 percent in 2018.
“The current strength of imports is unlikely to be sustained if, as we expect, slower credit growth feeds through into weaker economic activity in the coming quarters,” said Julian Evans-Pritchard of Capital Economics in a report.
“Exports growth is also likely to edge down further ahead but should fare better than imports given the relatively upbeat outlook for China’s main trading partners.”
The country’s global trade surplus shrank by 18.4 percent from a year earlier to $40.8 billion.
The surplus with the 28-nation European Union, China’s biggest trading partner, expanded by 8 percent from a year earlier to $10.8 billion. That with the United States widened by 4 percent to $22 billion.
Frontpage October 22, 2019