Skip to main content
A scary good deal on trusted journalism
Get full digital access to globeandmail.com
$0.99
per week for 24 weeks SAVE OVER $140
OFFER ENDS OCTOBER 31
A scary good deal on trusted journalism
$0.99
per week
for 24 weeks
SAVE OVER $140
OFFER ENDS OCTOBER 31
// //

Container ships are docked at a port on the Yangtze River, in eastern China's Jiangsu Province, on Sept. 6.

The Associated Press

China’s exports unexpectedly grew at a faster pace in August thanks to solid global demand, helping take some of the pressure off the world’s second-biggest economy as it navigates its way through headwinds from several fronts.

The Asian giant staged an impressive recovery from a coronavirus-battered slump, but economic momentum has weakened recently owing to the Delta variant-driven COVID-19 outbreaks, high raw material prices, slowing factory activity, tighter measures to tame hot property prices and a campaign to reduce carbon emissions.

Shipments from the world’s biggest exporter in August rose 25.6 per cent year-on-year, picking up speed from a 19.3-per-cent gain in July, customs data showed on Tuesday, pointing to some resilience in China’s industrial sector.

Story continues below advertisement

Analysts polled by Reuters had forecast growth of 17.1 per cent.

“While near-term headwinds remain, supply constraints in China have eased and we think the global economic recovery will continue to underpin China’s exports later this year and in 2022,” said Louis Kuijs, head of Asia economics at Oxford Economics.

Exports from neighbouring countries also showed encouraging growth last month, with South Korean shipments accelerating on strong overseas demand. The shipments breakdown showed a broad-based uptick across all goods types, said Sheana Yue, assistant economist at Capital Economics.

“In particular, the rebound in Chinese-made consumer goods such as electronics, furniture and recreational products possibly reflected retailers in advanced economies replenishing their inventories ahead of the Christmas shopping season,” Ms. Yue said.

Moreover, some of the port gridlock appears to have cleared in a boost to China’s shippers last month.

The eastern coastal ports have suffered congestion as a terminal at the country’s second biggest container port shut down for two weeks because of a COVID-19 case. That put further pressure on global supply chains already struggling with a shortage of container vessels and high raw material prices.

The stretched global shipping capacity has left many boxes of finished goods piled up on Chinese factory floors, a factor set to bump up Chinese export numbers over coming months, said Meng Xianglong, founder of Heji Trade & Credit Research Centre based in the port city of Ningbo.

Story continues below advertisement

MORE STIMULUS ON TAP?

However, behind the robust headline figures, businesses are struggling on the ground. Companies faced increasing pressure in August as factory activity expanded at a slower pace while the services sector slumped into contraction. A global semiconductor shortage has added to the strains on exporters.

The country appears to have largely contained the latest coronavirus outbreaks of the more infectious Delta variant, but it prompted measures including mass testing for millions of people as well as travel restrictions of varying degrees in August.

Many analysts expect the central bank to deliver a further cut to the amount of cash banks must hold as reserves later this year to lift growth, on top of July’s cut which released around 1 trillion yuan (US$6.47-trillion) in long-term liquidity into the economy.

Imports increased 33.1 per cent year-on-year in August, beating an expected 26.8 per cent gain in the Reuters poll, led by still high commodity prices and partly reflecting the statistical effect of the low figures a year ago.

Commodity prices remain elevated despite Beijing’s attempts to cool them. In July, imports grew 28.1 per cent.

Story continues below advertisement

China’s coal imports in August rose 35.8 per cent from a year ago owing to tight domestic supply and strong demand, while iron ore imports also picked up for the first time in five months.

China posted a trade surplus of US$58.34-billion in August, versus the poll’s forecast for a US$51.05-billion surplus and US$56.58-billion in July.

The trade surplus with the United States – a source of years-long friction between the two economic powers – rose to US$37.68-billion from US$35.4-billion in July, Reuters calculations based on the customs data showed.

Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies