China’s trade surplus with US widens

China’s trade surplus with the US widened last year, while the country’s imports and exports last month fell as the long-running trade dispute begins to bite into the world’s No. 2 economy, data showed yesterday.

The surplus with the US is a major source of anger within US President Donald Trump’s administration, which last year imposed tariffs on hundreds of billions of dollars of Chinese goods and has warned of more to come.

Despite the levies, exports to the US last year grew 11.3 percent, while imports rose 0.7 percent, expanding the surplus to US$323.3 billion from US$275.8 billion in 2017, customs data showed.

However, in a sign that the White House’s measures are having an effect, China’s exports to the US last month sank. The figures come after a US delegation last week held three days of talks in Beijing in the first face-to-face meeting since Trump and Chinese leader Xi Jinping (習近平) last month pledged a 90-day truce to resolve the crisis.

Traditionally, China imports vast quantities of US soybeans in the second half of the year, long making it the most valuable import from the US.

However, the buying last year fell off after China in the summer imposed a 25 percent retaliatory tariff on the commodity. Total imports of soybeans last year fell 7.9 percent to 88 million tonnes, the customs data showed.

“The overall development of China-US trade in 2018 was still relatively normal, but the trade surplus did expand slightly,” Chinese General Administration of Customs spokesman Li Kuiwen (李奎文) said.

“We believe this is because China and the US are in different stages of development, and it also reflects the highly complementarity nature of the economies,” Li said.

China’s exports to the world last month fell 4.4 percent from a year earlier, while imports dropped 7.6 percent, reflecting sluggish demand at home and abroad.

“With global growth set to cool further this year, exports will remain weak even if China can clinch a trade deal that rows back Trump’s tariffs,” said Julian Evans-Pritchard of Capital Economics.

“With policy easing unlikely to put a floor beneath domestic economic activity until the second half of this year, import growth is likely to remain subdued,” he said.

China’s global trade volume last year rose, but its surplus with the world fell 16.2 percent to US$351.76 billion, as imports rose 15.8 percent and exports gained 9.9 percent.

Li said the customs administration would work to “improve the country’s business environment and expand foreign trade… to keep employment, the financial sector, foreign trade and foreign investment” stable.

There are some “hidden concerns” and “uncertain external factors” for development, Li added.

With US tariffs in place, the gloomy export picture has reinforced the need for Beijing to rely on its legion of consumers to grow its economy.

However, bad data — such as passenger car sales, producer costs, consumer inflation and manufacturing output — have added to concerns about China’s economy, which is expected to have grown about 6.5 percent last year, down from 6.9 percent in 2017 and the weakest rate in almost three decades.