China’s exports beat forecast to rise as trade war heats up

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Beijing: China’s exports beat gloomy forecasts to rebound in May though imports sank more than expected as the trade war with the United States heats up, official data showed on Monday.

The spat between the world’s top two economies escalated last month, with President Donald Trump increasing tariffs on USD 200 billion in Chinese goods.

But Chinese exports to the world bounced back to rise 1.1 per cent last month after falling 2.7 per cent in April, according to customs data.

Analysts surveyed by Bloomberg News had forecast a 3.9 per cent drop.

Imports, however, plummeted 8.5 per cent after rising 4.0 per cent in April.

The trade surplus surged to USD 41.7 billion in May compared with USD 13.8 billion the previous month.

Trade talks between the United States and China have stalled while the two countries have threatened to slap more sanctions on each other.

Trump has blacklisted Chinese telecom giant Huawei and warned that he could impose tariffs on nearly all remaining products from China, worth more than USD 300 billion.

Beijing responded to Trump’s latest tariff hike by increasing levies on USD 60 billion in US products on June 1.

China is also preparing its own blacklist of “unreliable” companies and has suggested that it could halt exports of rare earths – key to the production of many high-tech goods — to the United States.

Trump is expected to meet Chinese President Xi Jinping at the G20 summit in Japan at the end of the month.

US Treasury Secretary Steven Mnuchin said at a G20 meeting of finance ministers on Saturday that any potential deal with China will wait until the two presidents meet later this month, but Washington was ready to impose new tariffs if talks fail.