EXPORTS UP AS CHINA SET TO GAIN MORE GLOBAL SHARE
China’s yuan held steady following the upbeat data even as equity investors welcomed the forecast-beating numbers. The benchmark Shanghai Composite index and blue-chip CSI300 index both rose more than 1 per cent in morning deals.
The Asian economic juggernaut’s monthly export surpluses exceeded US$100 billion seven times last year, partially underpinned by a weakened yuan, up from just once in 2024, underscoring that Trump’s actions have barely dented China’s trade with the wider world even if he has curbed US-bound shipments.
Economists expect China to continue gaining global market share this year, helped by Chinese firms setting up overseas production hubs that provide lower-tariff access to the United States and the European Union, as well as by strong demand for lower-grade chips and other electronics.
A flagship of Beijing’s global industrial ambitions, China’s auto industry saw overall exports jump 19.4 per cent to 5.79 million vehicles last year, with pure EV shipments up 48.8 per cent. China would likely remain the world’s top auto exporter for a third year after first superseding Japan in 2023.
Beijing, however, has shown signs of recognising it must moderate its industrial exports if it is to sustain its success, and the leadership has been increasingly cognizant and vocal about imbalances in China’s economy and the image problem outsized exports are causing.
After November’s trillion-dollar surplus data, Chinese Premier Li Qiang was quoted last week on national television as calling for “proactively expanding imports and promoting the balanced development of imports and exports”.
The country also scrapped subsidy-like export tax rebates for its solar industry, a long-standing point of friction with EU states.
Lawmakers last month passed revisions to the Foreign Trade Law after two, rather than the usual three readings, in a signal to members of a major trans-Pacific trade pact that China is prepared to shift from industrial subsidies and towards freer, more open trade.
Despite the year-long truce on tariffs that Trump and Chinese President Xi Jinping struck in late October, US duties of 47.5 per cent on Chinese goods are well above the roughly 35 per cent level analysts say enables Chinese firms to export to the US at a profit.
Source: CNA
