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China's trade growth moderates in April

Editor: zhenglimin 丨Xinhua

05-08-2017 19:30 BJT

BEIJING, May 8 (Xinhua) -- Dragged down by declining commodity imports and weakness in external demand, China's foreign trade growth slowed in April, customs data showed Monday.

Exports in yuan-denominated terms rose 14.3 percent year on year to 1.24 trillion yuan (179.8 billion U.S. dollars), down from the 22.3-percent increase in March, data from the General Administration of Customs showed.

Imports increased 18.6 percent to 979.1 billion yuan, compared with a 26.3-percent increase a month ago.

The trade surplus of 262.3 billion yuan, up 0.6 percent year on year, increased from 164.3 billion yuan in March.

Monthly import growth was partly weighed down by a sharp decline in demand for commodities such as iron ore and crude oil, coupled with corrections in commodity prices in April, noted China Merchants Securities (CMS).

In U.S. dollar terms, exports went up 8 percent in April, almost on par with the 8.2-percent gain registered in the first quarter.

"The moderate decline in exports was partly a result of corrections in the U.S. economy," said Deng Haiqing, chief economist with JZ Securities, "As the corrections are seasonal, we expect exports to pick up in the long term."

While both exports and imports data fell short of investor expectations, growth itself is laudable, especially amid rising protectionism and anti-globalization sentiment.

During the first four months, trade with the European Union gained 15.5 percent year on year to 1.24 trillion yuan, accounting for 14.8 percent of the total. Trade with the United States expanded 20.3 percent to 1.18 trillion yuan, making it China's second largest trade partner.

"Compared to early 2016, when China's trade with the rest of the world contracted, the overall picture remains positive," said Tom Orlik, Bloomberg economist.

"Even so, a slowdown in exports will make it harder for the government to hit its other objectives," he added.

China is in the midst of what proponents are heralding as its harshest crackdown on financial risks in history. The country's top leadership has promised to review financial regulations after the financial watchdog rolled out a string of tightening measures targeting shadow banking and other undesirable practices.

The tightening regulation came as China reported a strong first quarter, with GDP growth hitting 6.9 percent year on year, beating the annual target of around 6.5 percent.

While the performance leaves room for deleveraging efforts, economists warned that policies that were "too aggressive" could weigh down on growth.

"The slower-than-expected growth in April's imports partly reflected the impact of tightening regulations on firms' financing costs and growth expectations," said Deng.

On a positive note, Monday's data indicates improved trade structure.

In the first four months, general trade expanded 21.6 percent year on year to 4.75 trillion yuan, accounting for 56.5 percent of the total trade volume.

Trade of private enterprises grew 21.7 percent to 3.17 trillion yuan in the first four months, accounting for 37.6 percent of the total, 0.4 percentage points higher than the same period last year.

Customs data also showed that a leading indicator for China's exports rebounded from 40.2 to 40.7 month on month in April, signaling positive potential in exports.

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