China’s exports grew 25% year-on-year in August, accelerating from 23.9% in July and keeping external demand as a key support for an economy still facing weak domestic consumption and a prolonged property downturn.
The increase matched economists’ forecast, while imports jumped 28.2% year-on-year, up from 27.5% in July although slightly below expectations for 30% growth, according to customs data.
Strong global demand for Chinese-made cars, semiconductors and other high-tech products continued to drive shipments, highlighting the growing importance of exports as Beijing works towards its annual economic growth target of 4.5% to 5%.
The stronger trade performance contrasts with softer domestic conditions. China’s economic growth slowed to 4.3% in the second quarter, while industrial output and retail sales weakened in July. Fixed-asset investment also declined more sharply during the first seven months, with the property market remaining under pressure.
China’s trade surplus widened to US$119.09 billion in August from US$112.5 billion in July.
The export strength has also allowed Beijing to avoid more aggressive measures to boost household income and domestic consumption for now. The government has instead stepped up fiscal support, including an 800 billion yuan financing tool worth about US$119.21 billion to support infrastructure investment.
However, continued reliance on exports leaves China exposed to potential trade restrictions. The US and European Union have both pressed Beijing to reduce its trade surpluses.
Meanwhile, a trade truce between China and the US has held despite recurring tensions, with both sides exploring reciprocal tariff cuts covering US$30 billion of goods from each country ahead of another summit later this month.
Reuters
