Trade with Russia is booming
China’s exports unexpectedly surge
04/13/2023 10:04 am
Experts were actually expecting a renewed decline in Chinese foreign trade, but things turned out differently: exports have increased immensely compared to the previous year. One reason is the increased demand from Russia. For China, the large increase in foreign trade marks a trend reversal.
China’s exports rose unexpectedly. Exports in March surged 14.8 percent in US dollar terms compared to the same period last year, Beijing Customs reported. The rise to $315 billion surprised experts, who had expected another decline after a 6.8 percent slump in January and February. However, trade with Russia in particular is booming.
The strong development of the Chinese export machinery should give new impetus to the second largest economy. Imports showed a slight minus of 1.4 percent to 227 billion US dollars. However, the decline was less than in January and February at 10.2 percent. Experts had also expected significantly weaker import figures. The strong increase in foreign trade totaling 7.4 percent in March marked a trend reversal for the world’s largest trading nation after exports had previously declined for five months in a row.
The trade surplus rose to $88 billion. Trade with Russia rose 71.9 percent in March. Exports to the neighbors suffering from Western sanctions even rose by 136.4 percent. Imports, including cheap energy imports, increased by 40.5 percent, according to customs. Since the invasion of Ukraine began more than a year ago, China has backed Russian President Vladimir Putin. The US also benefited. China imported 5.6 percent more from the US in March. Its exports to the largest economy fell 7.7 percent, according to customs.
Export essential for China
Germany’s exporters suffered again from a minus of 2.1 percent. China’s exports to Germany also fell by 1.4 percent. Its exports to the EU, on the other hand, increased by 3.4 percent – as did its imports from the community.
Chinese foreign trade weakened noticeably last year due to the strict corona measures in China and lower global demand. After the end of the zero Covid strategy with its highly restrictive measures in December, a violent corona wave initially paralyzed the Chinese economy, which only recently picked up noticeably again.
The new head of government, Li Qiang, made it clear just how important exports are for China when he called on a cabinet meeting last week to “try every method” to stabilize foreign trade. While Chinese growth last year was only three percent, the government has set a target of around five percent for this year. The International Monetary Fund (IMF) expects 5.2 percent.