PEKIN (Reuters) – China export growth was the lowest recorded in three months in May under the effect of customs duties established by the United States while the deflationary pressures have increased, increasing pressure on the second world economy.
The trade war launched by US President Donald Trump and reversals in trade relations between China and the United States have put Chinese exporters in difficulty and aroused uncertainties on global economic prospects.
A sign of the impact of American customs duties, China exports to the United States have plunged 34.5% in May over a year in value, the highest drop recorded since February 2020 and the COVVI-19 epidemic, according to customs data published on Monday.
In total, Chinese exports increased over a year by 4.8% in May, after an increase of 8.1% in April and 12.4% in March, while shipments had accelerated in anticipation of upcoming American customs duties.
Economists interviewed by Reuters touched on an increase of 5% for May.
Imports fell 3.4%, after a decline of 0.2% in April and much more than the 0.9% withdrawal by economists interviewed by Reuters.
The United States and China concluded a commercial break last month suspending for 90 days the customs duties set up on both sides, but the two countries remain in conflict on essential commercial issues, such as the restrictions imposed by China for rare land exports and the United States control of flea exports to China.
American and Chinese delegations must meet this Monday in London on Monday to resume commercial negotiations after a telephone interview last week between Donald Trump and his Chinese counterpart Xi Jinping.
“Export growth has probably been slowed down by hard -dusted customs inspections in May due to increased export control efforts,” said Xu Tianchen, economist at Economist Intelligence Unit.
Deflationist pressures
Other data published on Monday on price evolution showed a worsening of deflationary pressures in China.
Production prices fell 3.3% in May over a year, after a drop of 2.7% in April. This is the strongest withdrawal recorded in 22 months.
Consumer prices fell 0.1% from one month to another.
The weakness of prices and domestic demand is another factor penalizing the Chinese economy, which struggles to initiate a solid post-pandemic recovery and is based on exports to support its growth.
The increase in retail sales has slowed down last month and spending stagnated in a context of insecurity on the job market and real estate crisis.
On Monday, the American coffee channel Starbucks announced that it would lower the price of some of its frozen drinks in China.
(Written by Yukun Zhang and Ryan Woo; Blandine Hénault, edited by Kate Entringer)
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