BEIJING, Sept 8 (Reuters) – China’s export growth picked up pace last month, remaining a key driver for an economy that is still grappling with tepid domestic demand and external uncertainties.
China’s exports expanded 25% year-on-year in August in U.S. dollar terms, matching forecast and accelerating from the 23.9% growth in the previous month, customs data showed on Tuesday.
Imports soared 28.2%, compared with a 27.5% year-on-year increase in July and a forecast for a 30% rise.
The boom in exports, supported by global demand for Chinese-made cars, semiconductor and other high-tech goods, contrasts with the weaknesses in domestic consumption, investment and the property market. The dichotomy highlights Beijing’s reliance on external demand to achieve its annual growth target of 4.5-5%.
After growth cooled to 4.3% in the April-to-June period, economic data released last month showed industrial output and retail sales both slowed at the start of the third quarter, while fixed-asset investment recorded a sharper decline in the first seven months. The property market, once a major growth driver, is still in a years-long downturn.
While the AI boom lifted the profits of advanced manufacturers, industries relying on the domestic market have been grappling with producer price inflation and soft demand.
Premier Li Qiang, the country’s No. 2 leader, in August called for efforts to stabilise external demand and expand international trade cooperation while acknowledging insufficient domestic demand, hardships facing industries and companies as well as rising uncertainties in international environment.
The government has stepped up fiscal support for the economy, including deploying an 800 billion yuan ($119.21 billion) financing tool to shore up infrastructure investment. But the strength in exports relieves Beijing of immediate large-scale actions to boost household income, improve job security and revive the property market to effectively elevate domestic consumption.
Relying on outbound shipments to absorb industrial capacity also exposes China to risks of curbs from trading partners, as the United States and the European Union have both demanded Beijing lower its trade surpluses.
China’s trade surplus came in at $119.09 billion in August, expanding from $112.5 billion the previous month.
A trade truce between Beijing and Washington, reached late last year when the two countries’ presidents met, has held despite on-and-off frictions. The two governments are now exploring reciprocal tariff cuts on $30 billion worth of goods from each side as they prepare for another summit later this month.
($1 = 6.7108 Chinese yuan renminbi)
(Reporting by Yukun Zhang and Liz Lee; Editing by Shri Navaratnam)
