China exports shrink as Trump trade tensions loom
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- China exports shrink as Trump trade tensions loom
HONG KONG (AP) — China's exports fell back into contraction last month, signaling renewed weakness for the world's second biggest economy as it faces possible trade tensions under Donald Trump's presidency.
Customs data posted Friday showed that exports shrank 6.1 percent to $209.4 billion in December compared with the year-ago period.
The latest numbers mark a return to a long term downward trend amid tepid global demand. In November, China's exports eked out a 0.1 percent expansion after shrinking for nine straight months.
In a sign of lackluster domestic demand, imports rose 3.1 percent to $168.5 billion, slowing from a 6.7 percent rise the month before and leaving a trade surplus of $40.8 billion for the month.
The figures cap a dismal year for Chinese trade, with combined imports and exports contracting 6.8 percent. For 2016, China's trade surplus amounted to $510 billion, according to the figures released by the General Administration of Customs.
Slumping trade adds to pressure on China's communist leaders trying to shore up weakening growth in the economy.
China's top economic planner said earlier this week the economy is estimated to have expanded by about 6.7 percent last year. Those figures, which will be confirmed when fourth-quarter data is released Monday, are within the official target range of 6.5 to 7 percent but down sharply from double-digit growth half a dozen years ago.
"China is lagging behind the recent improvement in Asian exports and thus the country's trade outlook will remain challenging in 2017," Betty Wang and Raymond Yeung of ANZ Bank said in a report. "Sluggish global demand and anti-globalization sentiment will continue to cloud Asia's export outlook, including China's."
China's trade woes may worsen after U.S. President-elect Donald Trump takes office next week. Trump, who railed about America's big trade deficits during his campaign, has accused China of unfair trade practices and threatened punishing tariffs.
"Trump's trade policy will likely motivate U.S. businesses to move their manufacturing facilities away from China, although the latter's efforts in promoting high-end manufacturing may offset part of the loss," Wang and Yeung said.
China says protectionist Trump may limit growth of its exports
- Posted 13 Jan 2017 11:05
- Updated 13 Jan 2017 13:46
BEIJING: US President-elect Donald Trump may limit the growth of China's exports by imposing greater trade protectionist measures, China's customs agency said on Friday (Jan 13).
China is the biggest loser in the anti-globalisation trend, customs spokesman Huang Songping told reporters, adding it will be difficult for China's foreign trade to improve in 2017 due to rising costs and other factors.
China, the world's largest trading nation, could be heavily exposed to protectionist measures this year if Trump follows through on campaign pledges to brand it a currency manipulator and impose heavy tariffs on imports of Chinese goods.
China's performance affects partners from Australia to Zambia, which have been battered as its expansion has slowed to levels not seen in a quarter of a century.
"There remain some obstacles facing China's foreign trade development," Huang told reporters at a news conference announcing the results, adding the international trading environment was "severe and complex".
Exports slipped 6.1 per cent to US$209.4 billion in December, Customs said, much worse than the four percent tipped in a survey by Bloomberg News.
Imports were essentially in line with expectations, rising 3.1 per cent to US$168.6 billion, while the trade surplus dropped nearly a third year-on-year to US$40.8 billion.
Figures for the whole year showed an even sharper decline, with exports down 7.7 per cent to US$2.1 trillion, and imports dropping 5.5 per cent to US$1.59 trillion.
It had earlier released the figures in yuan terms, showing a 2.0 per cent drop in exports last year.
Next week sees the release of economic growth data for the whole year. On Monday the country's top economic planner Xu Shaoshi said he expected to see growth of about 6.7 per cent, matching forecasts and government targets but marking the worst result in more than a quarter of a century.
BRACING FOR TRUMP
The yuan's recent slide against the dollar to eight-year lows helped lift exports in November, but the outlook for this year is shaky after Trump threatened to label China a currency manipulator and slap punitive tariffs on its goods.
The renewed exports slump came despite signs of recovering global demand at the end of last year, a trend reflected by positive trade data in Taiwan and South Korea, Julian Evans-Pritchard of Capital Economics said in a note.
It is concerning "given that the current environment of rising prices and relatively buoyant global manufacturing growth ought to have been supportive of Chinese trade values", he said.
And 2017 offers more downside risks as Trump has appointed hardliners to handle trade policy, he said.
The billionaire businessman's pick of outspoken China critic Peter Navarro to head the White House National Trade Council has alarmed Beijing. He has written books such as "Death by China" that accuse the country of waging economic war by subsidising its manufacturing industry and blocking American imports.
Next week Chinese President Xi Jinping will head to the World Economic Forum at Davos to defend globalisation and is expected to put forth his vision of the world economy in an era of rising protectionism.
But analysts doubt the country is ready to take the US's place in the world economy.
The global trade regime has been built around US demand and its large deficits with trade partners; China consistently runs huge trade surpluses with the US and other countries as the workshop of the world -- a mainstay of the decades-long boom that has propelled it to become the world's second-largest economy.
In 2016, its trade surplus reached US$510 billion in dollar terms, Customs data showed.
- Agencies/rw
