China trade surplus widens in April

China said Thursday its trade surplus widened in April as import growth slowed, casting doubts over the capacity of the world's second biggest economy to rebound quickly.

The country recorded a better-than-expected surplus of $18.42 billion in April, the customs agency said. Anaemic growth in imports covered weak exports, which continue to be hit by difficulties in Europe, China's biggest market.

Imports edged up just 0.3 percent year on year to $144.83 billion in April, raising questions about the government's ability to boost domestic demand as it tries to rebalance the economy away from export dependence.

Growth in shipments abroad rose just 4.9 percent to $163.25 billion.

"The export story is clear. We know the eurozone crisis is dragging down exports. We had just not anticipated by how much," said Alistair Thornton, economist for IHS Global Insight.

"Imports are much more worrying. They point to a real weakness in the domestic economy."

A survey of economists by Dow Jones Newswires had forecast imports to rise 10 percent and exports to increase 8.5 percent.

Exports to the European Union grew a mere 0.3 percent from January to April, customs data showed, reflecting the recent string of poor data indicating a contraction in manufacturing activity in China's workshops and factories.

Thursday's figures add to concern about the state of the Asian giant, which plays a huge role in the growth of the world economy.

While April's trade surplus is the second in a row, the country in February posted a huge deficit of $31.48 billion -- the largest in more than a decade -- owing to falling overseas demand.

"Today's trade data lent further to support our view that China's economic growth has not bottomed out yet and that the authorities should provide more easing to stabilise momentum," Wei Yao, economist with Societe Generale said.

China's economy grew just 8.1 percent in the first quarter, hit by weak demand at home and abroad, despite a string of government measures to help struggling small businesses and support the export sector.

The central bank in February cut the amount of cash banks must hold in reserve for the second time in three months as policymakers moved to increase lending and boost domestic consumption. Analysts expect more measures following the release of Thursday's data.

The economy grew 9.2 percent last year and 10.4 percent in 2010, but the government in March set a growth target of 7.5 percent for this year, signalling markedly lower expectation.

Economists do not expect growth to strengthen until the second half of the year, when easing measures are expected kick in and growth to pick up in Europe and the United States.

"Looking forward, there will be easing on lending as well as more structural measures, such tax cuts and more investment in social housing," said HSBC economist Qu Hongbin.

The trade data should further ease tensions with the United States, which persistently argues that Beijing keeps its currency artificially low to subsidise its exports.

Last week, US Treasury Secretary Timothy Geithner, in Beijing for annual economic talks between the two countries, called for China to continue to let its currency appreciate further.

China's trade surplus narrowed in 2011 to $155.14 billion and analysts expect it to continue to shrink this year as both exports and imports remain weak.

Markets closed flat on Thursday as investors remained cautious ahead of more economic data to be released Friday.

The benchmark Shanghai Composite Index, which covers both A and B shares, edged up 1.64 points to 2,410.23.

Loading...

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • ISIS has not penetrated Phl – AFP
    ISIS has not penetrated Phl – AFP

    Security officials yesterday maintained that the Islamic State of Iraq and Syria (ISIS) has not penetrated the Philippines following an expert’s warning that the group poses a threat to the country. Abu Sayyaf, BIFF (Bangsamoro Islamic Freedom Fighters), private armed groups to our knowledge are the people making problems down south,” Armed Forces chief Gen. Gregorio Catapang Jr. said. The BIFF and the Abu Sayyaf have pledged allegiance to the ISIS but it remains uncertain whether they are …

  • Cerbo named national police intel chief
    Cerbo named national police intel chief

    Philippine National Police officer-in-charge Deputy Director General Leonardo Espina yesterday ordered the appointment of PNP spokesman Chief Superintendent Generoso Cerbo Jr. as chief of the Directorate for Intelligence. …

  • Pump prices up anew
    Pump prices up anew

    Oil companies announced yesterday another round of price hikes with independent oil firms among the first to issue their respective announcements. PTT Philippines, the local subsidiary of Thailand’s biggest oil firm, and Phoenix Petroleum Philippines, another independent oil company, were among the first to issue their respective advisories. Seaoil Philippines also issued its announcement. …

  • PNP to ease rules on gun permit processing
    PNP to ease rules on gun permit processing

    The Philippine National Police will simplify requirements for getting a firearm’s permit under the new gun control law, PNP officer-in-charge Deputy Director General Leonardo Espina said yesterday. Espina said they are working to simplify the process to secure a license to own and possess firearms (LTOPF) amid complaints of excessive requirements from gun holders. Espina directed the Firearms and Explosives Office (FEO) to make it easier for legitimate gun owners to comply with the …

  • Mercy for Mary Jane: Pacman joins appeals
    Mercy for Mary Jane: Pacman joins appeals

    World boxing superstar Manny Pacquiao took time out yesterday from final preparations for his $400-million megafight with Floyd Mayweather Jr. to plead for the life of a Filipina on death row in Indonesia. Pacquiao, a national hero in the Philippines, added his voice to a chorus of global opposition led by United Nations Secretary General Ban Ki-moon to the executions of a group of foreign drug convicts, including compatriot Mary Jane Veloso. The eight-division world champion, who will face …

  • Phl condoles as Nepal death toll hits 3,700
    Phl condoles as Nepal death toll hits 3,700

    Foreign rescue teams equipped with heavy cutting gear and relief supplies were landing round the clock at Nepal’s only international airport on the outskirts of Kathmandu, which has been devastated by Saturday’s 7.8-magnitude quake. “We need more helicopters for our rescue operations in rural areas,” said Nepal Home Affairs spokesman Laxmi Prasad Dhakal. In a statement issued yesterday, Aquino said a team from the Philippine embassy in New Delhi, India would travel to Nepal to meet the needs …

  • Heat index to rise to 39.9ºC on Friday
    Heat index to rise to 39.9ºC on Friday

    People in Metro Manila should stay indoors on Friday, wear lightweight and light-colored clothing and drink plenty of water as the heat index – the temperature as felt by the human body – may reach 39.9 degrees Celsius on that day. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) said this level of apparent temperature may cause heat cramps, heat exhaustion or heat stroke. “Heat index is a human discomfort index that gives the apparent temperature, or …

  • Indonesia rebuffs last-ditch bids to delay drug-convict executions
    Indonesia rebuffs last-ditch bids to delay drug-convict executions

    By Kanupriya Kapoor and Jane Wardell CILACAP, Indonesia/SYDNEY (Reuters) - Indonesia said the execution of nine drug traffickers would go ahead this week, rebuffing last-minute appeals from Australia and the Philippines to spare their nationals and ignoring a decision by the Constitutional Court to hear a final challenge. Australia began the day with a plea for a stay in the execution of Myuran Sukumaran and Andrew Chan, saying reports that their trial had been tainted by corruption needed to …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options