China exports, imports in deeper contraction as tariffs take toll
beijing — A slide in China’s exports picked up pace in September while imports contracted for a fifth straight month, pointing to further weakness in the economy and underlining the need for more stimulus as the Sino-US trade war drags on.
Analysts say it could take time for Chinese exports to recover amid slowing global growth despite tentative signs of a thaw in tense trade relations between the world’s top two economies.
On Friday, US President Donald Trump outlined the first phase of a deal to end the trade war with China and suspended a threatened tariff hike set for October 15. But existing tariffs remain in place and officials on both sides said much more work needed to be done.
September exports fell 3.2 per cent from a year earlier, the biggest fall since February, customs data showed on Monday. Analysts had expected a 3 per cent decline in a Reuters poll after August’s one per cent drop.
“The headline figures suggest that global demand softened last month, adding to the pressure from the US tariffs that went into effect in September,” said analysts at Capital Economics.
Economists also attributed the export slowdown to a fading in the so-called “front-loading” effect. Some Chinese firms had rushed to ship goods to the United States ahead of the September deadline, supporting overall July and August export readings.
“We expect shrinking exports will likely be one of the biggest drag on China’s economic growth in the coming months, as the tariff impact will be further in place, along with the pay-back effects,” said Ting Lu, chief China economist at Nomura.
Total September imports fell 8.5 per cent after August’s 5.6 per cent decline, the lowest since May, and were expected to fall 5.2 per cent.
Some sectors held a silver lining. China’s industrial metals imports, including iron ore and copper, surged in September fuelled by firm demand at steel mills.
China reported a trade surplus of $39.65 billion last month, compared with a $34.84 billion surplus in August. Analysts had forecast $33.3 billion.
We expect shrinking exports will likely be one of the biggest drag on China’s economic growth in the coming months, as the tariff impact will be further in place, along with the pay-back effects.”