Published: Fri, July 13, 2018
Economy | By

Despite Trump efforts, U.S. trade deficit with China hits record

Despite Trump efforts, U.S. trade deficit with China hits record

Wang said he had been under the impression that four rounds of high level talks in recent months between China and the United States had averted the trade war.

Washington has warned it may ultimately impose tariffs on more than $500bn worth of Chinese goods - almost the total amount of USA imports from China a year ago.

The expanding trade surplus was largely because of smaller imports.

"Those talks produced progress, so much so that the United States government said they would put the trade war on hold, but all of a sudden an announcement was made to impose tariffs on imports from China".

Exports rose 11.3 per cent over a year earlier to $216.7 billion, down from May's 12.6 per cent growth, customs data showed Friday.

China's foreign trade faces risks of slowing in the second half of the year, General Administration of Customs spokesman Huang Songping told a news conference, though he said Beijing was capable of handling challenges. So far, encouraged by strong job growth and expectations of good quarterly earnings reports, United States markets have been strong and the Australian market has reached a 10-year record high.

Investors fear a prolonged trade battle with the United States could harm business confidence and investment, disrupting global supply chains and harming growth in China and the rest of the world.


China's commerce ministry confirmed last month that Chinese exporters were front-loading shipments to the United States to get ahead of expected tariffs - a situation that could exacerbate any slowdown in shipments toward the year-end.

In yuan terms, China's exports grew 3.1% in June and imports rose 6.0%.

But in a statement from its commerce ministry, China blamed those problems on the U.S., saying the imbalance was "overestimated" and caused by America's own "domestic structural problems".

Imports increased by 14.1%, below the forecast 21.3%.

The spiralling battle with Beijing shows no signs of cooling down, and observers warn the impact will begin to hurt soon as China's economy struggles with slowing growth just as leaders try to battle a worryingly large debt mountain.

Speaking after a regular two-yearly review of China's trade policies at the World Trade Organization (WTO), Wang was sceptical. Its trade surplus with the U.S. over the same period was $133.76bn, up from $117.51bn past year.

China's commerce ministry confirmed last month that Chinese exporters were front-loading exports to the U.S. to get ahead of expected tariffs - a situation that could exacerbate any slowdown in shipments toward the year end. China retaliated with higher duties on a similar amount of American goods.

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