Economists earlier predicted a slowdown to 23%

There was an unexpected acceleration in China’s export growth last month, indicative that the country has surpassed the impact of port disruptions in the southern part of the country.

Export growth accelerated to 32.2 per cent in June from a year earlier, China’s customs administration reported today.

This news has greeted several economists with much surprise, as they had earlier predicted that the growth would slow down to 23 per cent.

However, imports climbed 36.7 per cent, also beating the median forecast of 29.5 per cent, which left a trade surplus of US$51.5 billion for the month, the highest since January. This has helped to underpin the economy amid signs that the recovery is starting to slow.

SURGE IN TRADE DESPITE COVID-19 RESURGENCE

China’s trade authorities reports that global appetite for Chinese goods including medical goods and work-from-home equipment has helped spur exports this year with the data showing a broad-based expansion, with stronger shipments of goods such as cell phones, refined oil products and shoes.

The surge in trade last month came despite resurgence in coronavirus cases in southern China that had caused delays in shipments at some major ports for much of June. Earlier, the customs administration reported trade in Yuan figures, showing exports climbed 28.1 per cent in the first half of the year from a year earlier, while imports rose 25.9 per cent.

Analysts have started the mull over the reason or reasons for this unexpected acceleration in export growth.

Zhou Hao, senior emerging markets economist at Commerzbank AG, opined that “the surprise surge in exports is probably in large part due to rising commodity prices, as commodities like iron ore soared and price pressures passed on from imports to exports”.

He contended that export growth would likely slow in the second half of the year because of a high base last year.

Li Kuiwen, a spokesman for the customs administration, is projecting a slower growth in imports and exports for the rest of the year, while noting that full-year trade is still expected to register relatively fast expansion.

TRADE SURPLUS WITH US CONTINUED TO INCREASE

Export growth to the US slowed to 17.8 per cent in June, while picking up strongly to Hong Kong, Japan and South Korea. China’s trade surplus with the US continued to increase, reaching US$32.6 billion last month.

The slowdown in import growth, however, suggested that domestic demand recovery might be losing steam, though the headline reading remained relatively strong.