SOURCE: Financial Express
China's trade booms after the pandemic.
While some governments are re-imposing anti-virus curbs that limit business and trade, exporters have benefited from China’s relatively early reopening of its economy and demand for Chinese-produced masks and other medical supplies.
In April, China’s trade with the US and the rest of the world increased by double digits as consumer demand recovered, but growth appeared to be slowing.
Global exports increased 32.3 percent year over year to $263.9 billion, matching March but falling short of the explosive 60.6 percent increase seen in the first two months of 2021, according to customs data released Friday.
Imports increased 43.1 percent to $221.1 billion in April, outpacing the 38.1 percent increase in March.
In comparison to a year ago, when global economies were shut down to fight the coronavirus, China’s trade gains appear especially dramatic. Once that distortion and seasonal fluctuations are taken into account, forecasters say growth will flatten out.
Despite the increase in headline figures in April, exports are levelling off, and the rebound in imports has stalled, according to Capital Economics’ Julian Evans-Pritchard. “Demand is most likely nearing a cyclical peak.”
The trade outlook is clouded by a tariff war with the United States, and surveys show that export order growth slowed in April. President Joe Biden has yet to say how he plans to restart trade talks to end the trade war.
Domestically, economic output increased by only 0.6 percent in the three months ending in March, indicating that China’s explosive recovery was abruptly slowing. As a result, China’s demand for iron ore, consumer goods, and other imports is expected to slow.
As industries recover from the pandemic, global shortages of processor chips are causing problems for Chinese manufacturers of smartphones, cars, consumer electronics, and other goods.
Despite tariff hikes that remained in place after Beijing and Washington agreed to a truce in their trade war last year, April exports to the United States increased 30.8 percent year on year to $42 billion. Despite Chinese tariff hikes, imports of American goods increased by 23.5 percent to $13.9 billion.
China’s global trade surplus shrank by 5% to $42.8 billion, indicating that Chinese demand is recovering more quickly than the rest of the world. Its politically tumultuous trade surplus with the US increased by 33.4 percent to $28.1 billion.
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China’s trade booms after the pandemic China’s trade booms after the pandemic China’s trade booms after the pandemic