On Monday, in August with more countries relaxing coronavirus lockdowns, exports from China have risen for the third consecutive month by 9.5% from a year earlier, according to customs data, marking the strongest gain since March 2019.
China’s imports have slumped by 2.1%, compared with market expectations for a 0.1% increase and extending a 1.4% fall in July.
The rise in exports underscores a faster and more balanced recovery to the Chinese economy, which unlike other economies, is rebounding from a record first-quarter slump.
“China’s exports continue to defy expectations and to grow significantly faster than global trade, thus gaining global market share,” said Louis Kuijs of Oxford Economics.
According to a private survey on manufacturing activity, Chinese factories have reported the first rise in new export orders this year in August with overseas demand slowly reviving. The rise in export orders has also led to the sharpest gain in almost a decade.
China’s export come on the back of record shipments of medical supplies induced by the COVID-19 pandemic which emerged from Wuhan China.
“With credit growth still accelerating and infrastructure-led stimulus still ramping up, import volumes should remain strong in the coming months,” said Julian Evans-Pritchard of Capital Economics.
In August, China’s copper imports reduced from the previous month’s all-time high, probably because of a closing in an arbitrage window in the overseas metal market; demand from key consumption sectors have also slowed.
China’s coal import also saw a fall by 20.8%, from the month before, along with iron ore imports which fell by 10.9% from July, but which rose from a year earlier on resilient demand for steel.
It posted a trade surplus of $58.93 billion in August, against an analysts’ estimate of $50.50 billion.
China’s trade outlook is far from rosy since external demand could suffer from coronavirus control measures which could be re-imposed by trade partners later this year in case of a resurgence.
Its trade surplus with the United States has widened to $34.24 billion in August, up from $32.46 billion in July.
Although trade officials from both countries have reaffirmed their commitment to the Phase 1 trade agreement China’s imports have fallen in August. This could be because of new U.S. sanctions on Chinese technology companies, opined Iris Pang, chief economist for Greater China at ING.
A potential rise in U.S.-China ties is likely to impact China’s exports of technological products and services in the coming months, said Iris.