China’s export growth in biggest drop since February, as US trade war continues to hammer economy

Both exports and imports fell by more than expected in the world’s second largest economy in September, with US tariffs causing serious issues for China’s trade

US President Donald Trump said China agreed last week to resume buying US farm goods as part of a deal that will also delay a tariff increase set for Tuesday

Reading Time:3 minutes

As part of an interim trade agreement that has yet to be officially confirmed but which has been discussed voluminously by US President Donald Trump, China is expected to make purchases of US farm goods amounting to tens of billions of US dollars. Photo: EPA

Published: 10:54am, 14 Oct 2019Updated: 8:49pm, 4 Nov 2019

China’s exports fell for the second month in a row in September, as the trade war with the United States continued to hit the world’s second-largest economy.

Shipments fell by 3.2 per cent during the month compared to a year earlier, after dropping 1.0 per cent in August in dollar terms. This was worse than the 2.8 per cent decline expected by analysts in a Bloomberg poll. It was also the biggest fall in exports since February, when they fell 20.7 per cent.

In addition, imports during the month fell by 8.5 per cent, well below the 6.0 per cent decline expected, showcasing weaker domestic demand. Imports have declined in every month this year apart from one - April.

The country posted a trade surplus of US$39.65 billion, above the US$34.83 billion recording in August, according to China’s General Administration of Customs. The new data will have been affected by a 15 per cent tariff on roughly US$112 billion of Chinese goods applied by Washington on September 15.

China’s exports to the US in September dropped 17.8 per cent to US$36.5 billion, from the 22 per cent decrease in August. Imports from the US, meanwhile, dropped by 20.5 per cent to US$10.5 billion.

Based on calculations by the South China Morning Post, China’s exports fell by 0.79 per cent in the third quarter of 2019 compared to a year earlier. Imports fell by 6.49 per cent over the same period, highlighting the serious and persistent challenge faced by Beijing on this front.