China with a record-breaking trade surplus with the US
China’s trade surplus with the US increased to record-breaking $ 35.6 billion in November. Exports remain strong despite US customs tariffs, but imports are down.
The relationship between the world’s two largest economies is still tense despite the «ceasefire» in the trade war that – according to US President Donald Trump – was reached between him and his Chinese counterpart, Xi Jinping, at the G20 summit in Buenos Aires last week.
The US trade deficit with China is a particularly sore thumb for Trump, who during his election campaign stressed the reversal of this trend. The increasing imbalance in trade between the two countries thus threatens to further exacerbate the possibility of a trade agreement after the 90-day long «ceasefire» is over.
China’s exports to the US rose by 9.8 per cent in November compared to November last year, while imports fell by 25 per cent in the same period, figures from the Chinese authorities show.
Fewer soybeans
US farmers have been particularly hard hit by the trade war, and Trump earlier this week Tweeted that China would start purchasing products from American farmers «effective immediate».
The Chinese trade figures reveal that the opposite is happening.
The Chinese usually buy more American soybeans at the end of the year as the American produce enters the market and the supply from its main competition – Brazil – is decreasing. China’s imports of US soya beans fell by 38 per cent in November compared to last year.
During the period from January to November, China’s trade surplus with the US has increased to $293.5 billion, compared to $251 billion in the same period last year.
Less than expected
With all the countries they trade with, including the United States, China had a trade surplus of $44.7 billion in November, up from 35 billion in October.
Growth in exports and imports declined compared to October. In November, Chinese exports increased by 5.4 per cent compared with the same period last year, while exports only increased by 3 per cent, both significantly less than Bloomberg and other financial media expected.
The slowdown in imports and exports is another bad sign for the Chinese economy, which, with a growth of 6.5 per cent in the third quarter of this year, experiences its lowest growth rate in nine years.
The Hang Seng Index in Shanghai has dropped by 18.8 per cent in the past year, and China’s yuan has dropped by about nine per cent against USD so far in 2018.
Norway is not very hard hit directly by Trump’s war on world trade since it does not export a lot of tariffed goods to the US. The ”winners” looks to be other countries in the Far East, such as Malaysia and Thailand, according to the Economist. Furthermore, the thawing of the bilateral relationship with China boosts trade between them.
© NTB scanpix / #Norway Today
