KEY POINTS

  • Chinese exports volumes jumped by 9.9% in September on a year-over-year basis
  • Imports to China soared by 13.2% in September – well above expectations
  • China’s global trade surplus amounted to $37 billion in September

Despite a global pandemic that has crushed many parts of multinational businesses, the Chinese economy continues to deliver a robust recovery.

Chinese export volumes jumped by 9.9% in September on a year-over-year basis, an improvement from the 9.4% growth recorded in August, the Beijing government said on Tuesday. A significant portion of those exported goods included medical gear designed to fight the COVID-19 virus.

Meanwhile, imports to China soared by 13.2% in September – well above expectations -- compared with a 2.1% contraction in August.

The increase in imports helped to decrease China’s trade surplus (how much a country's exports exceeds the cost of its imports).

China’s global trade surplus amounted to $37 billion in September, down dramatically from $58.9 billion in August.

China reported a $30.75 billion trade surplus with the U.S. in September, falling from $34.24 billion in the prior month.

While many economies in the developed world saw their gross domestic product collapse in the second quarter, China’s GDP actually climbed by 3.2% in the period.

Wang Jun, chief economist at Zhongyuan Bank, said government stimulus measures have helped to support the economy as the epidemic has been kept in control.

“This has boosted domestic demand, especially investment-led demand, which buoyed imports,” he said. “The other factor is the yuan’s recent appreciation, which is good for imports and people’s spending power.”

Julian Evans-Pritchard, senior China economist at Capital Economics, wrote in a research note that in the near-term, “infrastructure-led stimulus looks set to continue alongside a gradual recovery in oil prices, which is likely to keep imports strong.”

Evans-Pritchard added that Chinese exports should continue to benefit from the recovery in global demand.

He forecast a “further pick-up in shipments in the coming months.”

Meanwhile, tensions with the U.S. are expected to escalate as the presidential election quickly approaches. President Donald Trump has repeatedly accused Beijing of spreading COVID-19, while slapping sanctions on various Chinese tech firms over security concerns.

While top trade officials in both countries reaffirmed the terms of a phase 1 trade deal signed earlier this year, China has lagged behind in promised purchases of U.S. goods under the scheme.

China vowed to import some $36.5 billion in U.S. farm products this year under the deal.

U.S. Department of Agriculture Secretary Sonny Perdue recently expressed his doubts about China’s commitment to purchasing sufficient amounts of agricultural products as it has pledged – but he did not directly blame Beijing.

"I'm not sure they’re [China] going to make it, but they're trying,” he told a farm group in early October. “Non-agricultural trade issues get in the way."