China’s exports miss expectations as trade tariffs, geopolitical uncertainty loom

China’s exports rose but fell below market expectations in July, and analysts predict growth would likely decline in the second half of the year due to the relatively higher base effect and the implementation of tariffs by the United States and European Union.

Exports in July grew by 7 per cent from a year earlier to US$300.56 billion, according to customs data released on Wednesday.

Imports, meanwhile, rose by 7.2 per cent from a year earlier, compared to the 2.3 per cent decrease reported in June.

Elsewhere, China’s July trade surplus stood at US$84.65 billion, compared with US$99.05 billion in June.

In the first half of the year, China’s export sector effectively fended off a downturn in the domestic economy, supporting efforts to meet the full-year growth target of 5 per cent.

But increasing accusations regarding China’s export of its overcapacity suggest that it is likely to face more trade barriers.

On Wednesday, China’s onshore yuan dropped to 7.1845 per US dollar in morning trade, down slightly from Tuesday’s close.

“With the rise of protectionism and unilateralism, global trade barriers have increased significantly,” said a commentary published in the People Daily’s newspaper at the end of July.

“Due to the economic uncertainty of major trading partners and the shift in orders, China’s foreign trade will continue to face pressure in the second half of the year.”

More to follow …