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.

  • PSEi breaches 8,000 level, but profit-taking pared most gains

    [caption id="attachment_257092" align="alignleft" width="150"] PSEi breaches 8,000 mark (PSE photo)[/caption] Local share prices surged on a slew of positive news from abroad, sending the Philippine Stock Exchange index past the 8,000 mark for the first time in history. BDO Unibank chief market strategist Jonathan Ravelas said the market rose due to “positive foreign equity portfolio flows and Fed Chair Yellen’s comments last week reiterating thethat the FOMC will be data dependent and …

  • Abandoned, hard-up husband hits P60-M Lotto pot

    Lady luck finally smiled on a hard-up tricycle driver, who endured being abandoned by his wife and seeing his children drop out of school before hitting the Philippine Charity Sweepstakes Office (PCSO) 6/45 Lotto jackpot worth nearly P60 million. PCSO acting chairman Jose Ferdinand M. Rojas II said the 29-year old lucky bettor hit the jackpot in the March 20 draw by correctly picking the winning numbers 02-03-14-22-29-30, which corresponds to the birth anniversary dates of his family members. …

  • News In Brief

    P/$ RATE CLOSES AT P44.80/$1The peso exchange rate closed  lower  at P44.80  to the US dollar yesterday at the Philippine Dealing & Exchange Corp. (PDEx) from P44.76  last  Friday.  The weighted average rate  unchanged  to  P44.796  from  P44.796.  Total volume amounted to $340.6 million.PUMP PRICES RAISED THIS WEEKThe pump prices of gasoline products will be raised by P1.10 per liter this week and diesel by P0.60 per liter, according to the oil companies. In an advisory to the media, the oil …

  • Need for modern national sports complex underscored

    Sen. Juan Edgardo “Sonny” Angara yesterday pushed for the construction of a “state-of-the-art” and “highly scientific sports complex” that can be used by the country’s national athletes for high-level training and total wellness program. Angara, chairperson of the Senate Committee on Games, Amusement and Sports, said the government should at least provide decent support to its athletes by providing them with ultramodern sports venues and facilities if it wants them to improve the country’s …

  • Makati mayor slams PNP’s role in mayoralty row

    Makati Mayor Jejomar Erwin S. Binay denounced what he called apparent “misuse” of the Philippine National Police (PNP) force in the implementation of “selective suspension” of government officials not allied with the ruling party. Binay said he sympathizes with PNP personnel who often got caught in the middle of political conflicts, and called for an end to dirty political tactics. [caption id="attachment_257243" align="aligncenter" width="648"] THANKSGIVING MEAL – Vice President Jejomar C. …

  • EVAP warns of unscrupulous foreign electric vehicle suppliers

    The Electric Vehicle Association of the Philippines  (EVAP) has cautioned local manufacturers and end users against unscrupulous foreign EV suppliers that are flocking into the domestic market. In a sunrise industry like the electric vehicle industry, EVAP stressed that choosing the right partner or supplier is a difficult task. “In the absence of any track record to review, an end user is at a loss as to how to choose a reliable and competent supplier,” said Atty. Bodie Pulido, EVAP …

  • Mayors laud bill increasing tax revenue allocation for LGUs

    The League of Municipalities of the Philippines (LMP) is backing the proposed increase in the annual automatic allocations for local government units (LGUs) to boost inclusive growth with improved infrastructure, modernized agriculture and easier access to resources. Mayor Jess Burahan, secretary-general of the LMP said the empowerment of LGUs through added resources is a game changer in boosting inclusive growth. …

  • Freeze order against Jinggoy assets final; Bong guards face raps

    The Sandiganbayan Fifth Division has turned down with finality the plea of Senator Jinggoy Ejercito Estrada to lift the freeze order on his properties amounting to more than P183 million. In a resolution released yesterday, the Fifth Division denied Estrada’s motion for reconsideration that sought that the court lift its writ of preliminary attachment/garnishment that was issued on February 17 that ordered the freeze of his properties. “As movant has not filed a counterbond and his arguments …

POLL

Should Aquino be held accountable over the Mamasapano operations?

Loading...
Poll Choice Options