China’s imports and exports grew in the first two months of this year after weakening toward the end of 2016.
Exports rose 4 percent from a year earlier in January and February to $302.8 billion, rebounding from a 6.1 percent contraction in December, customs data showed Wednesday. Imports rose 26.4 percent to $260.6 billion, accelerating from December’s 3.1 percent growth.
Analysts often look at January and February together to screen out the impact of the two-week Lunar New Year holiday, which begins on a different date each year.
“The latest trade data suggest that, seasonal distortions aside, both exports and imports strengthened at the start of 2017,” Julian Evans-Pritchard of Capital Economics said in a report.
Last year, exports shrank by 7.7 percent. Weak global demand is a drag on Beijing’s efforts to nurture self-sustaining economic growth based on consumer spending instead of trade and investment. Those plans call for keeping exports steady to avoid job losses in industries that employ millions of people.
“We expect external demand to remain fairly strong during the coming quarters,” said Evans-Pritchard.
“However, we doubt that the current pace of import growth can be sustained,” he said.
“With growth in China currently running above trend and both monetary and fiscal policy being tightened, it is only a matter of time before we see a slowdown in domestic demand.”
The country’s top economic official, Premier Li Keqiang, on Sunday trimmed this year’s official growth target to “around 6.5 percent,” down from last year’s expansion of 6.7 percent. If achieved, that would be China’s weakest rate since 1990 but among the world’s strongest this year.
The premier warned China faces growing uncertainty due to rising global pressure for trade controls.
Chinese leaders have defended free trade in response to U.S. President Donald Trump’s promises to raise duties on Chinese goods, though Beijing’s trading partners complain China is the most closed major economy.
China’s global trade surplus for January and February contracted by 56 percent to $42.1 billion.
Its surplus with the United States declined 12.1 percent to $31.8 billion, while that with the 28-nation European Union, its biggest trading partner, shrank 23.3 percent to $18.7 billion.
China’s import bill has been boosted by higher prices for metals and other commodities for which its factories are among the biggest buyers. That has helped to shrink its trade surpluses.
For the month of February, exports shrank 1.3 percent to $120.1 billion. Imports jumped 38.1 percent to $129.2 billion.
China ran a trade deficit of $9.1 billion in February, as it usually does early in the year as factories replenish raw materials and components following their holiday shutdown.