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An unexpected jump in Chinese exports

China’s exports recorded an unexpected rise in August of 25.6 percent over a year, driven by sales of cardboard products and the global recovery, the Chinese Customs Administration announced Tuesday.
This is the fastest pace recorded in the Asian giant’s overseas sales since last February. This performance is much better than expected. Economists have expected a slowdown in the increase in exports, which will not exceed, according to their estimates, 17.1 percent, after rising 19.3 percent in July over a year.
In the same period last year, Chinese exports were recovering from the impact of the “Covid-19” epidemic, and recorded their best performance since the emergence of the Corona virus in China at the end of 2019. Analyst Ken Cheong of Mizuho Bank said that the “strength” of exports is not It merely reflects the “vitality of Chinese growth”; But the “strength” of global demand as well, despite the spread of the “delta” mutant.
In August, China’s exports were clearly driven by strong demand for electronic products and entertainment “before the Christmas shopping season” in the West, says analyst Julian Evans-Pritchard of Capital Economics. But he cautioned, however, that demand should “slow” in the coming months.
The Asian giant made a strong recovery from the repercussions of the Corona virus, but the economic momentum has weakened recently due to the outbreak of the “Delta” strain, high raw material prices, slowing factory activity, tightening measures to curb the rise in real estate prices, and a campaign to reduce carbon emissions.
“Although headwinds persist in the near term, supply constraints in China have eased … We believe that the global economic recovery will continue to support China’s exports this year and in 2022,” said Louis Koyes, director of Asia economies at Oxford Economics.
Exports from neighboring countries also showed encouraging growth last month, as shipments from South Korea accelerated thanks to strong external demand.
On the other hand, China’s imports also recorded a rise, last month. China’s overseas purchases increased 33.1 percent in August over the course of a year, according to customs. This pace is much faster than that recorded in July (28.1 per cent), and better than analysts’ expectations (27 per cent).
As for the trade surplus of the giant Asian country, it amounted to 58.3 billion dollars (49.07 billion euros) in August. And China’s trade surplus in July amounted to about 56.5 billion dollars (47.64 billion euros).
The strong rise surprised analysts, who had expected foreign trade to be affected by higher transportation costs and delays at ports, after both issues disrupted global supply chains. Experts also expected that the Chinese economy, the second largest in the world, would lose some of its momentum after China recorded, weeks ago, the largest outbreak of “Corona” in about a year.
Although forecasts have been revised down recently, experts expect economic growth of more than 8 percent in China this year. In the first quarter, China’s economy grew by 12.7 percent, but the main reason for this high rate is the low data for the base period last year, when trade declined after the outbreak of the “Corona” virus.
The government is targeting growth of “more than 6 percent” this year. Last year, the country recorded growth of only 2.3 percent, largely due to the impact of the pandemic on the global economy.