Chinese trade got off to a soaring start this year, customs data released Sunday showed, bolstered by higher U.S. and European demand, as well as growing internal consumption.
Exports rose 60.6% in January and February combined to reach a $103.25 billion trade surplus, a sharp increase from the $7.21 billion deficit recorded over the same period last year by China's General Administration of Customs.
This is a "significant upside surprise," said UBP senior economist Carlos Casanova, who expects other key economic trackers to also exceed expectations when they are published next week.
"Moreover, remember that China was first in, first out of the spring lockdowns. A stronger than expected first quarter GDP could also mean upside risks for the global economy in the second quarter," he told Business Times, noting the "unprecedented" base effect of pandemic-related lockdowns.
ASEAN was China's largest trading partner over this period largely on account of the Belt and Road Initiative, according to a government statement on Sunday, but exports to the U.S. and Europe were also up 87.3% and 62.6%, respectively.
Even the decline in exports over February, attributed to the Lunar New Year's timing this year, was still roughly 155% higher than the quantity of goods exported in February 2020.
Last month, exports were also helped by a more subdued holiday period, which saw factory workers take shorter breaks in the face of domestic travel restrictions.
Exports of toys, furniture and personal protective equipment led sector growth with year on year increases of 96.8%, 81.7% and 75.3%, respectively, data showed.
Chinese imports over the first two months of 2021 also grew stronger than economists anticipated, hitting 22.2% year on year instead of the predicted 16.0%, Casanova said.
"Imports saw a potential divergence in industries, with heavy industries lagging compared to high tech ones," he said.
China's unusually strong start to the year may fade as more export economies recover and as its largest trading partner, the U.S., places more pressure on this relationship in light of human rights violations.
"The Biden administration will put semiconductors, artificial intelligence and 5G networks at the heart of the U.S.'s strategy towards China," said Casanova.
Even so, the economy will likely meet its 6% growth target this year announced at the National People's Congress last week, which is a relatively modest goal compared with the 8% forecasted by market observers.
