Chinese trade data for June was better than May’s performance, according to numbers out yesterday, but the country is looking as though it will fall short of official targets for the full year.
And the second quarter trade data won’t do very much for the GDP figures out next week on July 16.
They are tipped to show growth of around 7.6%, a touch above the official target of 7.5%.
China’s Customers Bureau said yesterday exports rose 7.2% from a year earlier to $US186.8 billion, a touch better than the 7% gain in May.
And imports rose 5.5% to $US155.5 billion, rising from the surprise 1.6% drop in May.
The resulting trade surplus of $US31.6 billion was a bit smaller that May’s $35.92 billion, but up on the $US27.1 billion reported for June 2013.
China still solid as June trade surplus jumps
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Exports to the US rose 7.5% last month from a rise of 6.3% in May, while shipments to the European Union grew 13.1% in June, all but flat on the 13.4% rise seen in May.
In the six months to June, total trade with the European Union saw the largest year-on-year growth of 9.6% and accounted for 14.4% of the country’s total foreign trade in the period, the Customers Bureau figures showed.
Trade with the US grew 2.8% over the first half from a year earlier, followed by a 2.6% rise in trade with the ASEAN countries. Total trade with Japan was up a very modest 1.3% in the six months, reflecting the strained political tensions between the two countries.
Trade between the Chinese mainland and Hong Kong dropped 24.1% in the first half this year, reflecting the impact of the crack down on false invoicing.
In June China’s total foreign trade volume increased 6.4% to $US342 billion in the month.
That took the total volume of foreign trade to $US2.02 trillion, a rise of 1.2%, which tells us more than anything about the sluggishness of the Chinese economy in the six months to June.
Exports barely rose in the half year, rising a mere 0.9%, while imports were up 1.5%,
The trade surplus for the half was $US102.86 billion, down slightly from the $US107.5 billion reported for the first half of last year.
China has set a trade growth target of 7.5% this year, lower than the 8% goal for 2013 and last year’s actual expansion of 7.6%.
Based on the first half figures, the country could fall short of those targets, unless there’s a strong rise in exports and imports in the next six months.
China GDP set to miss ambitious 8% target
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But the performance in the first half of this year has been better than many of the talking heads in the US, Asia and Australia have been willing to admit.
For one thing, despite their erratic nature – there was the unexpected trade deficit of almost $US23 billion in February (the first in 11 months) which authorities blamed on the Lunar New Year holiday season – export growth has been maintained, at much lower growth levels.
That was despite the report in March, when China’s trade volumes fell dramatically which got some nervous analysts claiming the economy was in trouble – especially a big fall in imports.
But the real reason was the official crackdown on fake over-reporting of exports seen in early 2013, especially with shipments to Hong Kong and Taiwan where big falls in the value of exports were reported.
And then there’s the continuing attempts by the government to move from investment driven economic growth (helped by rising exports) to a growth model depending more on domestic consumption.
All up China’s economic growth model is changing. Next week we will know more.
