China’s exports gained steam in May thanks to firmer global demand, data showed on Sunday, but an unexpected fall in imports signalled weaker domestic demand that could continue to weigh on the world’s second-largest economy.
Exports rose 7 per cent in May from a year earlier, quickening from April’s 0.9 per cent rise, while imports fell 1.6 per cent, versus a rise of 0.8 per cent in April, the General Administration of Customs said.
China’s trade surplus widened sharply to $35.9 billion in May from April’s $18.5 billion, the customs office said.
That compared with market expectations in a Reuters poll of a 6.6 per cent rise in exports, a 6.1 per cent rise in imports and a monthly trade surplus of $22.6 billion.
“We do not think the May trade data will change the policy stance significantly,” Louis Kuijs, an RBS economist in Hong Kong, said in a note.
“While the export data is reasonably positive, the weakness of domestic demand implied by the import data may keep the pressure up for initiatives to support growth,” he said. China’s commerce ministry had predicted that the trade picture could brighten in May as base efforts fade and government support measures kick in.
Analysts have attributed the weak trade figures partly to an inflated comparison base with last year due to a rash of fake invoicing of exports to beat currency restrictions.
India’s trade deficit with China mounts to $9 bn in January-April
China’s trade with South Asian nations including India has touched a whopping $100 billion even as the deficit in trade between the two countries neared $9 billion in the first four months of this year.
Trade volume between China and South Asian nations jumped from $35 billion in 2006 to about $100 billion in 2013, but the fast growth features a rising trade imbalance with China exporting more, state-run Xinhua news agency reported. The India-China trade topped much of the $100 billion as the bilateral trade totalled $65.47 billion in 2013 with trade deficit mounting to $31.42 billion. Indian officials said the trade deficit averaged about $35 billion in the last three years. ( PTI)
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