China’s trade surplus records $676.4 billion in 2021

BEIJING – China’s politically volatile trade surplus rose to $676.4 billion in 2021, probably the highest ever for any country, as exports jumped 29.9% from the previous year despite a semiconductor shortage that disrupted manufacturing.

Customs data on Friday showed that the country’s monthly trade surplus in December inflated 20.8% from a year earlier to a record $94.4 billion.

China accumulated a series of monthly export surpluses in 2021 but drew less criticism from the United States and other trading partners than in previous years while their governments focused on containing the coronavirus infection.

Exports rose to $3.3 trillion in 2021 despite a shortage of processor chips for smartphones and other goods as global demand rebounded from the coronavirus pandemic. Manufacturers have also been hampered by energy rationing in some areas to meet government efficiency targets.

Chinese imports in 2021 rose 30.1% to $2.7 trillion with the world’s second largest recovery from the epidemic.

Economic growth weakened in the second half of the year as Beijing carried out a campaign to reduce what it sees as dangerously high debt in the real estate industry, but consumer spending was above pre-pandemic levels.

Manufacturing activity rose in December, but new export orders shrank, according to a survey conducted by the State Statistics Bureau and an industry group, the China Federation of Logistics and Purchasing, earlier.

Chinese exporters benefited from being allowed to resume most normal business in early 2020 while foreign competitors faced anti-coronavirus restrictions on travel and trade. This advantage continued into 2021 as other governments renewed their controls in response to the spread of new virus variants.

Earlier, meteorologists said Chinese exporters would benefit from the spread of the latest variant, Omicron, which Beijing appears to be keeping out of the country. Recently, however, China responded to outbreaks within its borders by imposing travel restrictions on major cities including Tianjin, the manufacturing hub where omicron was found.

China’s global trade surplus registered a 26.4% increase compared to 2020, an economic surplus that economists said was among the highest ever recorded by any economy. The only comparison as a percentage of the size of the economy, they said, was likely Saudi Arabia and other oil exporters during the price boom of the 1970s, but their total revenue was lower.

A ballooning trade surplus has strained China’s central bank’s ability to manage the yuan’s exchange rate, which has risen to multi-year highs against the US dollar as money flows into the country. The People’s Bank of China attempted to limit the ability of banks and other traders to speculate on the movement of the currency.

China’s trade surplus with the 27-nation European Union, its second largest trading partner, ballooned by 57.4% in 2021 compared to the previous year to $208.4 billion. Exports to the European Union rose 32.6% to $518.3 billion while imports of European goods increased 19.8% to $309.9 billion.

In December, China’s trade surplus with Europe widened 85.9% from a year earlier to $25.1 billion.



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