China Trade Balance

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China: Imports contract in May driving trade balance to five-year high

June 8, 2014

In May, exports increased 7.0% over the same month last year, which was above the 0.9% increase recorded in April. The print overshot the 6.7% that market analysts had expected and represented the largest gain in four months. May’s export data largely reflected the fading impact of exporters having overstated trade invoicing early last year.

Imports contracted 1.6% annually in May, which contrasted the mild 0.8% increase recorded in April. The decline also contrasted the 6.0% expansion that market analysts had expected. May’s weak imports raised concerns among analysts over how robust China’s domestic demand really is.

The trade balance recorded a surplus of USD 35.9 billion in May (April: USD 18.5 billion surplus), which was well above the USD 20.5 billion surplus recorded in the same month last year. The print overshot market expectations of a USD 22.0 billion surplus and marked the largest surplus since January 2009. The 12-month moving sum of the trade surplus rose from USD 235 billion in April to USD 250 billion in May.

The government set the target growth for the total volume of exports and imports at 7.5% for this year. FocusEconomics Consensus Forecast panelists project that merchandise exports will grow 8.1% in 2014 (USD 2.4 trillion) and they see the trade surplus reaching USD 270 billion. For 2015, the panel expects exports to increase 9.1% and the trade surplus to widen to USD 282 billion.


Author: Ricard Torné, Head of Economic Research

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China Trade Balance Chart


China Trade12m May 2014

Note: 12-month sum of trade balance in USD billion and annual variation of the 12-month sum of exports and imports in %.
Source: General Administration of Customs of the People’s Republic of China and FocusEconomics calculations.


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