China’s trade sur­plus with US hits record high

Sun.Star Cebu - - BUSINESS -

China’s 2018 trade sur­plus with the United States surged to a record US$323.3 bil­lion but ex­ports con­tracted in De­cem­ber, as the de­layed im­pact of Pres­i­dent Don­ald Trump’s tar­iff hikes started to hurt de­mand.

Ex­ports to the United States in 2018 rose 11.3 per­cent to $478.4 bil­lion de­spite Trump’s puni­tive du­ties in a fight over Chi­nese tech­nol­ogy am­bi­tions, cus­toms data showed Mon­day. Im­ports of Amer­i­can goods rose just 0.7 per­cent over 2017, re­flect­ing Bei­jing’s re­tal­ia­tory tar­iffs and en­cour­age­ment to im­porters to buy more from non-US sup­pli­ers.

In De­cem­ber, Chi­nese ex­ports to the United States that had held up through much of the year fell 3.5 per­cent from a year ear­lier to $40.3 bil­lion. Sales to the US mar­ket had kept grow­ing by dou­ble dig­its in pre­vi­ous months as Chi­nese ex­porters rushed to fill or­ders, but fore­cast­ers said Amer­i­can or­ders would slump once the full im­pact of Trump’s penal­ties hit.

The slow­down adds to pres­sure on Bei­jing to re­solve the bat­tle with Trump at a time when the rul­ing Com­mu­nist Party is also try­ing to re­verse an eco­nomic slow­down.

“The ex­ter­nal en­vi­ron­ment is still com­pli­cated and se­vere,” a cus­toms agency spokesman, Li Kui­wen, said at a news con­fer­ence.

Li cited dan­gers in­clud­ing “pro­tec­tion­ism and uni­lat­er­al­ism”--a ref­er­ence to Trump’s im­port con­trols, a pos­si­ble slow­down in global eco­nomic growth, and a de­cline in cross-bor­der in­vest­ment.

US and Chi­nese of­fi­cials ended a three-day ne­go­ti­at­ing ses­sion last week with no sign of agree­ments or word on what their next step would be.

“The record US trade deficit with China will sit un­com­fort­ably with the Trump ad­min­is­tra­tion,” Nick Marro of the Econ­o­mist In­tel­li­gence Unit said in a re­port. “That may cast a shadow over the next round of trade talks.”

Trump and his Chi­nese coun­ter­part, Xi Jin­ping, agreed on Dec. 1 to post­pone ad­di­tional tar­iff hikes by 90 days while they ne­go­ti­ated. But penal­ties of up to 25 per­cent al­ready im­posed on bil­lions of dol­lars of

each other’s goods re­main in place, rais­ing the cost for Amer­i­can and Chi­nese buy­ers of soy­beans, med­i­cal equip­ment and other goods.

Trump is press­ing Bei­jing to roll back plans for state-led cre­ation of Chi­nese cham­pi­ons in ro­bot­ics and other tech fields. Washington, Europe and other trad­ing part­ners com­plain such poli­cies vi­o­late its mar­ket-open­ing obli­ga­tions. Chi­nese of­fi­cials have sug­gested ini­tia­tives such as “Made in China 2025” might be opened to for­eign com­pa­nies, but they refuse to aban­don strate­gies they see as a path to pros­per­ity and more global in­flu­ence. /


QUAL­ITY CON­TROL. A worker checks on soy­beans at a pro­cess­ing fac­tory in Xiao­tun Town­ship of Dafang County in Bi­jie, Guizhou Prov­ince.

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