China’s trade surplus with US narrows

worth of Chinese goods last year and has threatened more to come.

Officials from the world’s top two economies are holding negotiations in Beijing yesterday and today in a bid to resolve their thorny trade dispute.

Trump in December postponed plans to sharply hike tariffs on $200 billion of Chinese imports until March 1 to allow more time for negotiations. This week he indicated he was open to extending the trade truce depending on progress in Beijing.

Tariff hikes unlikely

China’s trade surplus with US in January US — unexpectedly rose 9.1 per cent in January from a year earlier, turning a corner after exports fell in December.

“One possible explanation for January’s upbeat export data could be some re-arrangement of regional supply chains on the back of the ongoing China-US trade dispute,” said Betty Wang, an economist at ANZ bank.

Exports to Europe and ASEAN countries surged, she wrote in the research note. China’s imports, however, continued to fall in January, down 1.5 per cent from a year earlier, though at a slower pace than a 10.2 per cent decline forecast.

“The import slowdown in recent months obviously in part reflects the slowdown in China’s domestic economy,” said Kuijs.

A slew of bad economic data has added to concerns about China’s economy, which grew at its slowest pace in almost three decades last year. Analysts cautioned that it is difficult to compare trends at the start of each year due to the Chinese New Year holiday, which came in early February this year and can affect business activity.

“The broad trend in shipments still appears to be pointing down,” said Julian EvansPritchard of Capital Economics.

“The downbeat outlook for global growth means that this year is likely to be challenging for Chinese exporters, even if the ongoing US-China trade negotiations culminate in a deal,” Evans-Pritchard wrote in a research note.