The Asian nation appears to be increasing its leverage ahead of expected talks between Trump and Chinese President Xi Jinping later this month
[BEIJING] China’s export growth picked up pace in September, buoyed by manufacturers finding buyers in markets beyond the US as a tariff deal with US President Donald Trump remained elusive while investors grappled with the latest salvoes in their trade war.
Outbound shipments from the world’s second-largest economy rose an annual 8.3 per cent last month, customs data showed on Monday (Oct 13), up from a 4.4 per cent gain in August, and beating a 6 per cent increase forecast in a Reuters poll.
Imports grew 7.4 per cent, against a 1.3 per cent gain previously, and a forecast rise of 1.5 per cent.
No other country comes close to matching US consumption power, which once absorbed over US$400 billion of Chinese goods each year. But policymakers are banking on factory owners boosting sales to Asia, Africa and Latin America to offset the trade curbs and keep the US$19 trillion export-oriented economy on track to hit an official annual growth target of around 5 per cent.
China appears to be increasing its leverage ahead of expected talks between Trump and Chinese President Xi Jinping later this month. Last week, China put several new rare earth elements under export controls and imposed additional scrutiny on semiconductor users, raising the risk of another supply crunch for US and European users.
The two superpowers appear to be struggling to chart a path beyond their current tariff truce, a 90-day pause from Aug 11 that ends around Nov 9.
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US and Chinese officials met after last month’s Madrid summit, widely viewed as a breakthrough for a deal struck on TikTok, to discuss technical issues that predated that meeting.
In the meantime, Chinese exporters have made strides in other markets. Exports to regional rival India hit an all-time high in August, according to the most recent customs data, and shipments to Africa and South-east Asia are on track for annual records.
China’s trade surplus fell to US$90.45 billion in September, from US$102.33 billion a month prior, and missing a forecast of US$98.96 billion.
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Pointing to the persistent depressed domestic demand, South Korean exports to China – a leading indicator of the world’s second-largest economy’s imports – rose just 0.5 per cent last month, recent data out of Seoul showed.
A slice of optimism came at the end of September, though, when China’s state planner said it will deploy 500 million yuan (S$91 million) of policy-based financial tools to accelerate investment projects, as part of Beijing’s efforts to support the slowing economy.
The announcement came too late to influence September data, with manufacturing activity for the month, as well as the most recent retail sales and factory output figures for August, lagging as China observers watched to see whether Beijing would announce fresh stimulus or a breakthrough with the Trump administration. REUTERS
