Agencies
China’s exports grew more quickly than anticipated in December to end the year at an all-time high, official data showed on Monday, as factories accelerated production to fulfill orders as they braced for heightened trade risks under a Trump presidency.
Overseas shipments represented a rare bright spot for Beijing last year as sluggish domestic consumption and a prolonged crisis in the property sector dragged on growth.
But President-elect Donald Trump, who imposed sweeping tariffs on China during his first term in office, has threatened even heftier levies when he returns to the White House next week.
Observers said that a recent surge in China’s exports has likely been boosted by companies ramping up stockpiles ahead of Trump’s second term amid fears of a painful trade war.
China’s total exports exceeded 25 trillion yuan for the first time, reaching 25.45 trillion yuan ($3.47 trillion), an increase of 7.1% year-over-year, Lu Daliang, spokesperson for the General Administration of Customs, said at a news conference.
Total imports, meanwhile, rose 2.3% to 18.39 trillion yuan, Lu said.
Combined trade swelled 5% to reach a record 43.85 trillion yuan, said Wang Lingjun, vice minister of the customs administration.
“China’s position as the world’s largest goods trading nation has become even more secure,” Wang added.
Official customs data showed Monday that exports in December rose 10.7% from a year earlier. Economists had forecast they would grow about 7%. Imports rose 1% year-on-year. Analysts had expected them to shrink about 1.5%.
With exports outpacing imports, China’s trade surplus grew to $104.84 billion in December, and nearly $1 trillion for the year, at $992.2 billion.
Trump has pledged to raise tariffs on Chinese goods and close some loopholes that exporters now use to sell their products more cheaply in the U.S. If enacted, his plans would likely raise prices in America and squeeze sales and profit margins for Chinese exporters.
China’s exports are likely to remain strong in the near term, said Zichun Huang of Capital Economics, as businesses try to “front-run” potentially higher tariffs.
“Outbound shipments are likely to stay resilient in the near-term, supported by further gains in global market share thanks to a weak real effective exchange rate,” she wrote in a note.
Chinese exports to the U.S. jumped 15.6% in December compared to the same time last year, while exports to the European Union jumped 8.8%. Outbound shipments to Southeast Asia grew by almost 19%.
China’s trade trade surplus with the U.S. widened to $33.5 billion from $29.81 billion a month prior.
But exports will likely weaken later in the year if Trump follows through on his threat to impose tariffs, Huang said.
Officials who briefed reporters in Beijing said the total value of China’s imports and exports reached a record 43.85 trillion yuan (nearly $6 trillion), up 5% from a year earlier.
China is the world’s largest exporter and the main trading partner of more than 150 countries and regions, said Wang.
China’s economy has slowed following the pandemic, partly because of job losses and a downturn in the housing industry, while exports have surged. Under leader Xi Jinping, the ruling Communist Party is promoting the upgrading of factories and a shift to more high-tech manufacturing.
The report Monday said China’s export of mechanical and electrical products increased by almost 9% last year from a year earlier, with growth in exports of “high-end equipment” jumping more than 40%.
Exports of electric vehicles rose 13%, exports of 3D printers jumped almost 33% and shipments of industrial robots surged 45%.
E-commerce trade, including sales by companies including Temu, Shein and Alibaba, registered 2.6 trillion yuan ($350 billion), more than twice the level in 2020.
China does not pursue a trade surplus and wants to increase its imports, the officials said. But while imports edged higher last year, they still lagged exports, partly due to lower prices for key commodities such as oil and iron ore.
Lagging imports also reflect weak demand as consumers and businesses cut back on spending.
“Regarding this year’s imports, we believe that there is still a lot of room for growth. This is not only because my country’s market capacity is large, there are many levels, and it has huge potential,” said Customs Administration’s Lu.
China is also blocked from exporting and importing some products due to trade restrictions, Lu said, alluding to controls by the U.S. and some other countries on strategically sensitive exports to China, such as sales of advanced semiconductors and items that can be used for military purposes.
“In addition, some countries politicize economic and trade issues, abuse export control measures, and unreasonably restrict the export of some products to China; otherwise, we will import more,” he said.
The officials emphasized China’s efforts to expand trade with countries participating in its “Belt and Road” initiative to expand infrastructure construction and trade across much of the globe. Trade with those countries accounted for about half of China’s total trade last year.
They noted that China has completely eliminated tariffs on imports from the world’s poorest countries.
But China also values trade with traditional markets like Europe and the United States, and two-way trade with the U.S. grew nearly 5% last year.
“We imported agricultural products, energy products, medicines, and aircraft from the United States, and exported clothing, consumer electronics, and household appliances to the United States, achieving mutual benefit and win-win results,” Wang said.
U.S. officials and other critics say Beijing has pushed an expansion of exports to help make up for sluggish demand inside China as the economy has slowed.
With factories in some industries operating well below capacity, they contend that the country has an “overcapacity” problem, while Chinese officials reject that contention.
“Whether from the perspective of comparative advantage or global market demand, there is no so-called ‘China’s overcapacity’ problem. This problem is a pure false proposition,” Wang said when asked about the issue.
China has made its industries more efficient through upgrading, investment and innovation supported by research and development, he said. “We have ensured the stability of the global production and supply chain with our own complete manufacturing industry chain, and driven technological progress and industrial upgrading around the world.” China’s trade figures for December come ahead of its full-year and fourth quarter gross domestic product (GDP) figures that are due on Friday. Beijing had a growth target of about 5% for 2024.
