BANGKOK – New customs data released on Friday shows that China’s export expansion softened slightly in July compared to the previous month, even as global appetite for the country’s high-tech electronics and motor vehicles remained at robust levels. The world’s second-largest economy saw its overall trade surplus narrow to $112.5 billion in July, down from $125.6 billion recorded in June, according to the official figures.
On a year-over-year basis, July exports climbed by close to 24%, following a stronger 27% annual gain in June. Imports also grew year-on-year, rising 27.5% – a rate that fell short of June’s 36% surge.
Industry analysts point to temporary disruptions as the main driver of the slower monthly growth, with typhoon-related weather forcing disruptions to Chinese port operations that delayed the movement of goods. Julian Evans-Pritchard, a senior analyst at Capital Economics, noted in a research report that while the red-hot pace of Chinese trade cooled marginally in July, the underlying trend for both export and import values remains strongly elevated.
Evans-Pritchard added that ongoing soaring global demand for Chinese electronics and green technology products continues to support trade volumes, while geopolitical disruptions from the Iran conflict have cut off Middle Eastern aluminum shipments, pushing up demand for Chinese exports of the metal.
The latest trade figures also highlight a long-term structural shift in China’s export economy: the country has now fully shifted away from its historic reliance on low-cost mass-produced goods, and now leads in supplying critical machinery and components for advanced manufacturing sectors around the globe.
Aggregated data for the first seven months of the year underscores this shift: exports of high-tech products jumped nearly 41% compared to the same period last year, vehicle shipments soared 55%, and overall exports of electronics and industrial machinery rose 26%.
When broken down by trading partner, growth has been uneven across key blocs. For the first seven months of the year, Chinese exports to the United States rose only 2.6% year-on-year, while imports of American goods grew just 1.4% by comparison. Exports to the European Union saw a much stronger gain of nearly 17% over the same period, while exports to the 10-nation Southeast Asian bloc – which overtook other regions to become China’s largest single trading partner – surged 25% year-on-year.