Hong Kong, May 09: China’s exports rose 14.1% in April from a year earlier, the government said Saturday, despite the Iran war and lingering impacts from higher US tariffs.
The data were released just days ahead of a planned meeting next week between US President Donald Trump and Chinese leader Xi Jinping in Beijing.
That beat analysts’ estimates and was a significant improvement from March’s 2.5% year-on-year expansion.
Imports climbed 25.3%, slower than the 27.8% growth in March but still robust.
The Trump-Xi summit comes at a time when relations are beset by multiple issues, with efforts to end the war in Iran eclipsing the usual sources of friction.
“We’re expecting that overall external demand will remain a solid driver of growth this year,” said Lynn Song, chief economist for Greater China at Dutch bank ING, likely led by China’s exports of semiconductors and autos.
In March, Chinese leaders set an annual economic growth target of 4.5% to 5%, slightly lower than last year’s 5% expansion and the lowest target since 1991. Export growth is expected to continue to power its wider economy, especially as shipments increased from China to Europe, Southeast Asia, Latin America and Africa over the past months.
Apart from efforts to broker a peace agreement to end the Iran war, trade and export controls, including rare earths and US tech restrictions on China, will likely be on the agenda during the Trump-Xi summit, following a yearlong US-China trade truce reached late last year when the two leaders last met in South Korea.
Major breakthroughs on export controls are unlikely, but the leaders’ upcoming meeting may bring “incremental” steps to troubleshoot trade friction, HSBC economists said in a recent research note.
“On balance, China looks to have more leverage,” wrote Leah Fahy, senior China economist of Capital Economics, in a note. “But higher tariffs haven’t stopped China’s exports from continuing to surge over the past year, and Beijing has showed that it is prepared to wait out US pressure.”
For China, oil and fuel price hikes caused by the war in Iran are also feeding higher manufacturing and logistics costs across its many factories, said Wei Li, head of multi-asset investments at BNP Paribas Securities (China), while higher global inflation could dampen consumer purchasing power in China’s overseas markets.
Still, China’s overall economy has remained resilient compared with other countries, owing to its large oil reserves and more diversified energy sources. ( PTI )
