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China’s exports grew at their fastest pace in more than a year last month, as trade remained a rare bright spot for the world’s second-largest economy despite rising tensions with Europe and the United States.
Exports rose 8.6 percent year-on-year in dollar terms in June, data from the National Bureau of Statistics showed on Friday, accelerating from 7.6 percent in May and marking the strongest expansion since March 2023. The figure beat expectations, with a Reuters poll of analysts forecasting 8 percent growth.
Imports fell 2.3 percent year-on-year in June, well below economists’ expectations for 2.8 percent growth and a 1.8 percent expansion in May.
Policymakers in Beijing have increasingly relied on exports and manufacturing to drive growth, as China’s economy grapples with weak domestic demand and a prolonged property slowdown, and ahead of the Communist Party’s economic policy conference, which begins on Monday.
But trading partners in the United States and Europe have responded to the surge in low-cost Chinese exports by tightening trade restrictions.
In May, the United States said it would sharply increase tariffs on $18 billion worth of Chinese imports, including a 100% duty on Chinese electric vehicles, while the European Union in June announced additional measures that would raise some tariffs on Chinese electric vehicles to nearly 50%.
Analysts have suggested that the surge in Chinese exports in recent months may have been driven by manufacturers front-loading shipments in an effort to avoid expected tariff increases in the United States, which are set to take effect in August.
Disruption of shipping routes through the Red Sea due to attacks by Houthi militants in Yemen has prompted some Chinese exporters to send goods early in a bid to ensure timely delivery during the Christmas rush.
Analysts said continued strong exports coupled with relatively weaker imports pointed to an unbalanced economic recovery. China’s consumer price growth slowed in June, rising just 0.2 percent year-on-year, while factory prices remained in contraction territory for the 21st straight month.
In recent years, the elite Central Committee of the Communist Party of China has used the Third Plenary Session to address pressing economic issues, with some observers calling for stronger measures to stimulate domestic demand and restore business and investor confidence.
But Li Keqiang, China’s premier, has tempered expectations of radical intervention, saying at a World Economic Forum event last month that the country’s economy should be allowed to “gradually recover.”
June figures show the country’s trade balance at $99.05 billion, beating expectations of $85 billion. During the first six months of the year, exports rose 3.6 percent and imports rose 2 percent compared to the same period in 2023.
Analysts at Capital Economics estimated that exports had risen in both volume and value and that the tariffs, which cover only a small portion of Chinese goods, would have a limited impact in the near term as exporters rerouted their shipments.
“Overall, we expect exports to remain a driver of economic growth in the near term,” they wrote in a note.
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