China's export fall in December amid ongoing US-China trade war

Posted January 16, 2019

Exports in the whole of 2018 rose 9.9 percent from 2017 while imports grew 15.8 percent over the same period, official dollar-denominated data showed. China exports to the USA declined 3.5 per cent in December while its imports from the United States were down 35.8 per cent for the month.

Traditionally China imports vast quantities of American soybeans in the second half of the year, long making it the most valuable import from the US.

"In anticipation of tariffs, USA firms increased their orders from China to avoid the higher costs of imports", Villanova's Casario said.

In comparison to the previous year, to 2018, the Income was down in global trade by 16.2 percent to almost 351.8 billion dollars, as the Chinese customs announced on Monday.

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Given Trump's frustration with China's huge trade gap with the United States, the latest data might fuel demands by hardliners in Washington to punish Beijing.

China imported 30 percent more crude oil in December than a year earlier, Reuters reports, citing fresh customs data.

China will work to straighten out trade frictions with the USA this year, the country's commerce minister told state media on Friday. It has been noted recently that Chinese imports of higher or more advanced tech declined 14.9 percent in December which was nearly double the size of the fall in overall trade. But a deal for "a more lasting suspension of new tariffs" looks more likely.

"China effectively tackled changes of the external environment a year ago, and the foreign trade maintained stable and positive growth, reaching a historic high in import and export volume", GAC spokesman Li Kuiwen told media on Monday while releasing the data.

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But, soybean imports from the US plunged to zero in November. Sales to the US market had kept growing by double digits in previous months as Chinese exporters rushed to fill orders.

China's General Administration of Customs said on Monday that the biggest worry in trade this year is external uncertainty and protectionism, forecasting the country's trade growth may slow in 2019. The figures suggest the negative impact of the trade war may be greater than Chinese authorities previously estimated, and point to the need for a more rapid and larger economic stimulus to stabilise growth, the Hong Kong-based South China Morning Post said in its report. Import growth also fell sharply in the face of cooling domestic demand. For all of 2018, soybean, the second largest imports from the USA, fell for the first time since 2011.

Sources told Reuters last week that Beijing is planning to lower its economic growth target to 6-6.5 per cent this year after an expected 6.6 per cent in 2018, the slowest pace in 28 years.

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