China’s imports grew at their fastest pace this year in September, while exports extended strong gains as more trading partners lifted coronavirus restrictions in a further boost to the world’s second-biggest economy.
Exports in September rose 9.9% from a year earlier, customs data showed on Tuesday, broadly in line with analysts’ expectations and up from a solid 9.5% increase in August.
The strong trade performance suggests Chinese exporters are making a brisk recovery from the pandemic’s hit to overseas orders.
As the global economy restarts, Chinese firms are rushing to grab market share as their rivals grapple with reduced manufacturing capacity.
“The big picture is that outbound shipments remain strong, with easing demand for COVID-19 related goods such as face masks being mostly offset by a recovery in broader demand for Chinese-made consumer goods,” Capital Economics Senior China Economist Julian Evans-Pritchard said.
“A jump in imports suggests that domestic investment spending remains strong.”
China’s factory activity has also picked up as international trading gradually resumes.
But some analysts warn exports could peak soon as the demand for Chinese-made protective gear recedes and the base effect of this year’s massive declines wears off.
Imports surged 13.2% in September, returning to growth from a fall of 2.1% in August and much stronger than expectations for a 0.3% increase. The import strength was broad based for almost all of China’s main trading partners.
Imports from Taiwan surged 35.8% in September from a year ago, while purchases from the United States rose 24.7% on-year. Imports from Australia, however, fell 9.5%.
RECOVERY AT HOME
Wang Jun, chief economist at Zhongyuan Bank, said the data showed government support for the economy has kicked in as the epidemic comes under control.
“This has boosted domestic demand, especially investment-led demand, which buoyed imports,” Wang said, adding that the yuan’s recent appreciation was positive for imports and people’s spending power.
The Chinese yuan rose to a 17-month high against the dollar on Friday.
The rise in imports pushed the trade surplus for September down to $37 billion, compared with $58.93 billion in August and lower than an expected $58.00 billion.
Across products, China bought more soybeans, grains, semiconductors, copper and steel products in September, customs data showed. Analysts expect imports to stay on an improving trend, underpinned by strengthening domestic demand.
Zhang Jun, chief economist at Morgan Stanley Huaxin Securities, said higher purchases of U.S. agricultural and energy products as China implemented the Phase 1 U.S.-China trade deal, and the resumption of logistics services in the United States and Europe contributed to China’s import strength.
Top U.S. and Chinese trade officials reaffirmed their commitment to a Phase 1 trade deal in a telephone call in August.
China’s trade surplus with the United States narrowed to $30.75 billion in September from $34.24 billion in August.