China’s Exports, Imports Grow, as Does Trade Surplus With US

Cornelia Mascio
Ottobre 12, 2018

China's export jump for the month suggests exporters were shipping goods early to beat the latest tariffs, said ANZ's China economist Betty Wang, citing the bounce in electrical machinery exports, much of which faced the looming duties.

"With global growth likely to cool further in the coming quarters and USA tariffs set to become more punishing, the recent resilience of exports is unlikely to be sustained".

She cited a jump in exports of electrical machinery - the biggest export item from China to the US - as a sign exporters might have pushed out shipments ahead of implementation of the latest tariffs on $200 billion in Chinese exports.

China has responded by imposing counter tariffs, which the Trump administration alleges show political interference by targeting products from key states in next month's congressional elections.

China's trade surplus with the USA grew 10 percent in September from a record $31bn in August, according to China's customs administration - a 22 percent jump from the same month previous year.

Despite concerns from some officials about the yuan's depreciation, U.S. Treasury staff have not recommended labeling China as a currency manipulator in a coming report on foreign exchange rate practices, according to media reports on Thursday.

Washington announced the nuclear technology controls a day after the U.S. Justice Department said it had arrested and indicted a spy for China's Ministry of State Security on charges of economic espionage.

The move comes as the United States is waging a trade war against China, with roughly half the products China sells to the U.S. each year now facing tariffs.

The United States is tightening controls on China's imports of civil nuclear technology to prevent use for military or other unauthorized purposes, the U.S. Department of Energy said on Thursday amid increased trade tensions. There is no specific date set for the next round of tariffs, even as Trump has made repeated threats to impose them on virtually all Chinese goods.

Beginning a year ago, the National Security Council led a review of China's efforts to obtain nuclear material, equipment and advanced technology from USA companies, government officials said in a conference call with reporters on Thursday.

Growth in overall imports for September instead showed a moderate slowdown, in line with signs the broad cooling in domestic demand. Analysts had expected imports to rise 15.0 percent, compared with August's 19.9 percent.

While the data showed China's trade remained strong for the month, analysts forecast the trade war will begin to hurt in the coming months. An official survey also confirmed a further manufacturing weakening.

The International Monetary Fund this week cited the trade war as it lowered its 2019 growth forecast for China, which is set to see its slowest expansion since 1990. It also slashed China's growth forecast for next year to 6.2 percent from 6.4 percent.

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