According to customs data released on Monday, exports in June jumped by 5.8% in U.S. dollar terms from a year earlier, surpassing Reuters' poll estimates of a 5% increase. This robust performance follows strong showings in April and May, where exports grew by 8.1% and 4.8% year-on-year respectively, showcasing Chinese exporters' successful diversification efforts into alternative markets such as Southeast Asia and the European Union, offsetting declines in U.S.-bound goods.
Imports also showed a positive turn, rising by 1.1% from a year earlier. While slightly missing economists' expectations of a 1.3% rise, this marks the first time imports have registered growth this year, reversing a trend of declining imports driven by sluggish domestic demand.
For the first half of the year, Chinese exports have surged by 5.9% year-on-year, while imports have slumped by 3.9%. This disparity resulted in a substantial trade surplus of $585.96 billion, nearly 35% higher than the same period last year.
The backdrop to this trade performance is the complex and evolving relationship between the United States and China. U.S. President Donald Trump's initial imposition of prohibitive tariffs of 145% on Chinese goods in April was met with swift retaliation from Beijing, including triple-digit duties and export controls on critical minerals.
However, a tentative trade truce struck in Switzerland on May 12 provided a crucial pause, leading both sides to temporarily drop a majority of tariffs for 90 days. This fragile truce faced challenges, with the U.S. accusing China of slow-walking its pledge to ease restrictions on rare-earth exports, and Beijing criticizing fresh U.S. tech export curbs and student visa revocations.
Despite these hurdles, ties between the two economic giants have shown signs of improvement following two days of meetings in London last month. During these discussions, both sides reached a framework agreement to implement the consensus. Notably, Beijing agreed to resume shipments of rare earths, while Washington offered to ease some export restrictions on ethane, chip-design software, and jet engine components.
Wang Lingjun, deputy chief of the Chinese customs authority, stated in a press conference on Monday that the Geneva agreement and the London framework were "hard-won," and both sides are accelerating efforts to implement the agreed terms.
The positive sentiment was echoed by U.S. Secretary of State Marco Rubio, who last week described his talks with Chinese Foreign Minister Wang Yi as "constructive and pragmatic," suggesting a high probability of a meeting between President Trump and Chinese President Xi Jinping. Foreign Minister Wang Yi also emphasized the importance of both countries upholding the consensus reached by their leaders through concrete policies and actions.
As the August 12 deadline for a durable trade deal approaches, all eyes will be on Beijing's upcoming release of its second-quarter gross domestic product (GDP) growth on Tuesday. Economists polled by Reuters anticipate a 5.1% growth rate, a slight slowdown from the 5.4% expansion recorded in the first quarter. This economic data will provide further insights into the health and trajectory of the Chinese economy amid the dynamic landscape of global trade.