China holds record trade surplus despite global supply chain problems Business and Economic News

China recorded a monthly trade surplus in October as exports rose, despite a disruption in the global supply chain.

Exports rose 27.1% in dollar terms last month from a year earlier to $ 300.2 trillion, data from the General Administration of Customs showed on Sunday. This was the 13th consecutive month of double-digit growth, exceeding the expectations of 22.8% of economists. Imports rose 20.6% to a $ 84.54 trillion surplus.

China’s trade growth has been above the pandemic level all year long. Exports up to October have already surpassed the full 2020.

Strong trade performance is helping the Chinese economy, which has slowed sharply in recent months, as a result of weak domestic demand caused by the real estate downturn, a slowdown in electricity production and weak consumer spending that has worsened the punctual outbreak of coronavirus.

China’s coal imports nearly doubled in October from a year earlier in Beijing to cope with power cuts caused by shortages of goods and rising electricity demand, especially from export-oriented manufacturers.

Imports of natural gas, an alternative to domestic heating, rose by 22% in the first 10 months of the year.

Global trade has been a record this year as economies around the world bounced back from virus-induced blockages in 2020. This has caused tension in many countries in supply chains due to shortages of containers and ships, as well as capacity in ports, including drivers. who send the goods to the merchants.

It is likely to improve supply chain crisis forecasts, as predicted by declines in shipping costs.

China’s exports to the European Union and the US grew the fastest among its major trading partners this year, customs data showed.

The nation’s trade surplus with the U.S., the source of trade tensions between the world’s two largest economies, rose to 2.08 trillion yuan ($ 325 billion) in 10 months from October’s 1.75 trillion yuan a year earlier, partly due to U.S. soybean imports from China. it has slowed down in recent months due to weather-related problems.

Machinery and electrical products accounted for nearly 60% of China’s exports in terms of value this year, the customs administration said.

Labor-intensive products, such as clothing and plastic products, accounted for another 18%. Goods such as appliances, lights and furniture saw the fastest growth in exports in October, Goldman Sachs Group Inc. analysts said in a note.

China is the largest source of demand for most raw materials because of its large industrial and construction economy in the world.

Demand for construction-related goods has slowed this year as a result of a decline in the country’s real estate market as iron ore imports fell in volume in October.

Reservations Pink

Dollar flows have helped the Chinese currency this year and added to the government’s foreign exchange reserves, which rose to $ 3.22 trillion in late October, according to the People’s Bank of China.

The dollars provide China with an important cushion to deal with the future blows of the world economy, even as individual companies like China Evergrande Group struggle to pay off their debts.

The nation’s strong export momentum will continue for at least the next few months, according to an analysis by Bloomberg Economics. Demand for Chinese products could slow if consumers in developed economies continue to move away from goods to consumption of services, and South and Southeast Asian countries will resume factory production after pandemic-related blackouts.

The government has warned of “downward pressure” on the economy in recent days and has vowed measures to boost domestic demand, including more supportive policies for small and medium-sized enterprises.

He has vowed not to use the real estate market to provide a temporary stimulus, and the central bank has remained conservative, insisting on making short-term loans to keep liquidity stable between banks. Bank reserve requirements have not changed since July and interest rates have remained stable since last year.