Global Economic Slowdown Bites China’s Trade Surplus
Los Angeles, CA – The global economic slowdown has taken a major bite out of China’s soaring trade surplus, according to the latest figures released by the Chinese General Administration of Customs in Beijing. The surplus climbed by 47 percent in 2014 to a record $382.5 billion with exports increased 6.1 percent to $2.34 trillion and imports rose 0.4 percent to $2 trillion. In December alone, the trade surplus soared 94 percent year-on-year to $49.6 billion, as exports increased 9.7 percent to $227.5 billion and imports fell 2.4 percent to $177.9 billion, Customs says.
Despite the eyebrow-lifting growth, total two-way trade for the year increased by 3.4 percent over the previous year, less than half of the government’s goal of 7.5 percent growth projection for 2014, the third consecutive year of missed trade goals.
Analysts say foreign-invested companies are currently responsible for generating for almost half of China’s exports. The trade figures come as China’s super-heated economy faces a continuing slowdown with a decrease in manufacturing, falling property prices, and high rates of corporate and local government debt all combining to take a toll. The country’s Gross domestic product (GDP) expanded an annual 7.3 percent in the third quarter of last year, the slowest since the height of the global financial crisis in early 2009.
Commenting on the newly released trade figures, Customs spokesman Zheng Yuesheng said that “while China’s trade growth is likely to rebound this year, it faces headwinds,” attributing the record surplus to “falling international commodity prices which dragged down import values.” The global economy, he said, “recovered rather slowly and couldn’t support China’s trade growing at a high speed.”
Last year, the country’s “comparative advantage of low costs continued to wane, while investment in China’s manufacturing industry from developed economies declined, containing trade growth,” he added.