Chinese exporters benefited from the relatively early reopening of the economy while competitors still faced anti-virus shutdowns.
The boom is forecast to soften as entertainment and other global service industries reopen and consumer spending habits return to normal. However, June’s strong figures suggest “this dampening trend may occur later than previously expected,” David Chao of Invesco said in a report.
Exports to the United States rose 17.8% over a year ago to $46.9 billion while imports of American goods grew 37.6% to $14.3 billion despite tariff hikes still in place in a lingering trade war.
China’s global trade surplus swelled 11% over a year earlier to $51.5 billion while the politically sensitive surplus with the United States expanded 10.9% to $32.6 billion.
President Joe Biden, who took office in January, says he wants better relations with Beijing but has yet to indicate whether he will roll back tariff hikes imposed on Chinese goods by his predecessor, Donald Trump, in a fight over Beijing’s technology ambitions.
Biden’s trade envoys have talked with Chinese officials by video link but have set no date for negotiations.
June exports to the 27-nation European Union rose 27% to $43.1 billion while imports of French, German and other European goods climbed 34.1% to $27.7 billion. The Chinese trade surplus with the EU widened by 16.7% over a year earlier to $15.4 billion.
June trade appeared to shrug off the disruption from a month-long disruption at the world’s fourth-busiest port, Yantian in the southern city of Shenzhen, after a coronavirus infection was found there in late May.
Activity at the port was cut to 30% of normal levels. It returned to normal in late June, but managers said it would take time to clear a backlog of thousands of shipping containers.
Customs officials launched an “emergency response plan” to cut processing time for paperwork and speed up transfers of ships to other ports, said Li, the agency spokesman.
Chinese economic growth soared to 18.3% over a year earlier in the first three months of 2021 as consumer and business activity revived. However, growth compared with the previous quarter at the end of 2020 was just 0.6%, showing the rebound was leveling off abruptly.
Consumer activity has lagged the revival of manufacturing. Retail spending rose 12.4% in May over a year earlier but fell short of forecasts.
Economic growth is expected to cool to about 7% over a year earlier in the three months ending in June and further through next year. To shore up activity, the central bank last week cut the amount of reserves commercial banks are required to hold, freeing up an additional 1 trillion yuan ($160 billion) for lending.
Some forecasters warn a Chinese recovery still isn’t certain because global demand is weak as some governments re-impose anti-disease curbs that are disrupting business and trade.
General Administration of Customs of China (in Chinese): www.customs.gov.cn
This aerial view shows the Yangshan container port in Shanghai, Saturday, July 10, 2021. China’s exports surged in June while import growth slowed to a still-robust level as its economic rebound from the coronavirus leveled off. (Chinatopix Via AP)