Wednesday, 12 December, 2018

China’s trade surplus with U.S. reaches record level

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China's exports to the USA rose 9.8 per cent for November on-year, while imports for the month fell 25 per cent on-year, the data from China's customs administration showed.

Imports grew 3 per cent, widening China's trade surplus to US$44.7 billion from US$34 billion.

Asked to confirm whether Beijing promised to buy American goods immediately, Gao said China will "immediately implement the consensus reached by the two sides on farm products, cars and energy".

As U.S. businesses import more products from overseas, they are subject to higher taxes on those imports, thanks to the new tariffs imposed by the Trump administration.

Gao's briefing came hours after the trade detente risked being rattled by the arrest in Canada of a top executive from Chinese telecom giant Huawei at the request of the United States.

However, the pace of export growth to the U.S. slowed from 13 per cent in October, which suggested that the impact of front-loading was fading as many American buyers had stockpiled goods well in advance.

Exports to the United States rose 9.8 per cent in November from a year earlier, compared with 13.2 per cent in October.

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But Trump again sought to paint the talks in a more positive light, highlighting a report from Bloomberg that "Chinese officials have begun preparing to restart imports of U.S. Soybeans & Liquified Natural Gas" that were put on hold as a result of the president's initial tariffs.

The US had been threatening to raise tariffs on US$200 billion of Chinese goods from 10 per cent to 25 per cent on January 1 - but this has since been deferred following last weekend's meeting between Donald Trump and Xi Jinping in Argentina. November's China numbers might add a sense of urgency.

Trump and figures in his administration have said China would immediately start buying U.S. goods in bulk, but Beijing has refrained from confirming those claims.

Economists say one factor helping keep up Chinese exports this year is that the yuan has weakened more than 5 per cent against the dollar, helping to make Chinese products more competitive overseas. "Typically there is a six-month lag between the value of industrial export orders and currency movements".

The government aims for growth of around 6.5 per cent this year, compared with 2017's 6.9 per cent pace.

Yang Yewei, an analyst at Southwest Securities in Beijing, said that as global demand cools, "domestic growth-boosting measures should be more effective".