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Sylvia Ma

China’s exports continued to post solid growth in July, maintaining momentum despite mounting geopolitical and trade headwinds.
The country’s exports rose by 23.9 per cent year on year to US$397.85 billion last month, according to Chinese customs data released on Friday. The reading was above a forecast of 22.88 per cent growth from economists polled by financial data provider Wind.
China also saw imports grow by 27.5 per cent last month to US$285.35 billion, surpassing projections of 26.67 per cent growth in a Wind poll.
That brought China’s trade surplus to US$112.5 billion last month, down from US$125.62 billion in June.
China’s exports have remained resilient this year despite headwinds from the US-Israel war on Iran, supported by the global technology cycle and strong demand for renewable energy products amid the energy shock.
But the country’s swelling trade surplus has intensified pushback from the West, prompting the European Union and the United States to threaten or impose measures targeting what they describe as China’s industrial overcapacity – an accusation Beijing rejects.
The Communist Party’s Politburo, a major decision-making body led by President Xi Jinping, also called on the country to “promote more balanced trade development” after a meeting last week.
We expect both imports and exports to maintain their growth momentum in the second half of the year, which would be positive for economic growth
Ding Shuang, Standard Chartered
Zhang Zhiwei, president and chief economist at Pinpoint Asset Management, said he expected China’s exports to remain strong in the third quarter, with its massive trade surplus maintaining pressure on the yuan to appreciate.
“The tension between China and its trading partners is heating up,” Zhang said.
“I expect intense negotiations between China and major trading partners in the coming months about what can be done to make trade more balanced – ahead of the US-China summit in September and the EU-China meeting on economic relations in October,” he added.
Last month, China’s exports to the United States rose 17.05 per cent year on year, set against a low baseline.
In late July, the US slapped a fresh wave of tariffs on 60 economies at rates ranging from 10 to 12.5 per cent under a Section 301 probe into forced labour, just before a temporary 10 per cent blanket levy was set to expire. China faces a tariff rate of 12.5 per cent.
Exports to members of the Association of Southeast Asian Nations rose by 38.36 per cent year on year, while shipments to the European Union increased by 15.95 per cent.
“We expect both imports and exports to maintain their growth momentum in the second half of the year, which would be positive for economic growth,” said Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered.


According to Ding, the artificial intelligence supercycle was expected to continue to support China’s hi-tech exports, while stronger demand for green energy products brought on by tensions in the Middle East would provide an additional boost. Meanwhile, he added, higher prices for computer chips and rising food prices driven by El Nino were also expected to raise the country’s imports in value terms.
“The sizeable trade surplus will continue to underpin the yuan,” he said, adding that the currency was unlikely to see a rapid appreciation in the second half of the year since it had already seen a notable rise.
When broken down into product categories, the data showed exports of integrated circuits rose by 1.76 per cent year on year by volume last month, while increasing by 116.57 per cent in value terms thanks to higher chip prices.
Meanwhile, imports of integrated circuits rose 8.46 per cent by volume, while their value increased 71.12 per cent from a year earlier.
The country’s crude oil imports reached US$22.78 billion in July, down 4.55 per cent year on year. Shipments fell by 24.32 per cent in volume terms.
Exports of hi-tech products jumped in value by 52.67 per cent last month from the year before, a sign the country is continuing to move up the manufacturing ladder.
China’s rare earth exports fell 29.54 per cent year on year by volume. Beijing has tightened control over outbound shipments of the minerals, vital to manufacturing a range of hi-tech products.


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Import and export growth readings beat economists’ forecasts, driven by higher chip prices and a jump in tech shipments


Import and export growth readings beat economists’ forecasts, driven by higher chip prices and a jump in tech shipments.


China’s trade surplus narrows in July as exports hold firm in strong tech cycle

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Import and export growth readings beat economists’ forecasts, driven by higher chip prices and a jump in tech shipments

Import and export growth readings beat economists’ forecasts, driven by higher chip prices and a jump in tech shipments