China’s latest customs data released on Friday revealed that in June, the country’s exports surpassed expectations, growing by 8.6% from the same period last year to reach $307.8 billion. This figure exceeded estimates of 7.4% to 8% growth. Meanwhile, imports saw a decrease of 2.3% year-on-year, totaling $208.8 billion.
The trade surplus for China widened to $99 billion in June, up from $82.6 billion in May as a result of the strong export performance. This increase in exports comes as China is facing heightened trade tensions with the United States and Europe, which have escalated tariffs on Chinese-made electric cars.
Despite the challenges posed by tariffs, experts believe that the impact on overall exports in the short term may be limited, as only a small portion of Chinese exports is being targeted. Zichun Huang of Capital Economics mentioned that shifts in trade routes and adjustments in exchange rates could help mitigate the effects of tariffs.
Looking ahead, it is expected that import volumes will rebound soon, driven by increased infrastructure spending following recent government bonds issuance. This rise in demand for industrial commodities is likely to boost imports.
The Association of Southeast Asian Nations (ASEAN) remained the largest destination for Chinese goods, with exports to ASEAN countries increasing by 10.7% in the January to June period. Notably, Chinese exports to the United States grew by 1.5% during the same period, while shipments to the European Union declined by 2.6%.
Key export categories for China this year include steel, automobiles, home appliances, and ships. Significant numbers of automobiles and ships have been exported by China, with 2.93 million automobiles and 29.8 million ships shipped in the first half of the year.
China’s economy continues to face challenges, with weak global demand following interest rate hikes by major central banks and a slowdown in the domestic property sector. The country aims for around 5% economic growth this year, a target that economists believe will require additional policy support to achieve. Factory activity in China remained stagnant in June, with the manufacturing purchasing managers index staying at 49.5, signaling no expansion or contraction.
