Spike in China’s trade sur­plus with US

The Straits Times - - ASIA -

BEI­JING China’s trade sur­plus with the US, which is at the cen­tre of their tar­iff tus­sle, widened to a record monthly high of US$28.97 bil­lion (S$39.6 bil­lion) last month, up from US$24.58 bil­lion in May,and the high­est in any month since 1999.

Ex­ports climbed to US$42.62 bil­lion, also a high, the Cus­toms ad­min­is­tra­tion said yes­ter­day.

But the Com­merce Min­istry con­firmed that Chi­nese ex­porters were front-load­ing ship­ments to the US to get ahead of ex­pected tar­iffs. This sug­gests the spike in the sur­plus was a one-off, with an­a­lysts ex­pect­ing a less favourable trade bal­ance for China in com­ing months as du­ties on ex­ports start to bite.

The US im­posed 25 per cent tar­iffs on US$34 bil­lion of Chi­nese goods on July 6, and an­nounced this week a plan to add 10 per cent tar­iffs on US$200 bil­lion worth of Chi­nese goods, in­clud­ing fur­ni­ture, hand­bags, pet food, re­frig­er­a­tors, tex­tiles and auto parts. Com­mit­tee hear­ing on tar­iffs on Thurs­day, sen­a­tors said they could not un­der­stand the ad­min­is­tra­tion’s trade strat­egy or how it plans to ob­tain im­proved trad­ing terms with other coun­tries.

“It is pretty ap­par­ent we don’t have a stated plan from a mar­ket­ing or busi­ness stand­point,” said Sen­a­tor Johnny Isak­son.

“We are go­ing to be in a ter­ri­ble sit­u­a­tion be­cause we don’t have a plan.”

Sen­a­tor Bob Corker, chair­man of the com­mit­tee, said tar­iffs im­posed on steel and alu­minium on na­tional se­cu­rity grounds are dis­rupt­ing sup­ply chains and hurt­ing busi­nesses.

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