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China’s trade up 3.4% in 2014, missing government target

By Wang Yanlin | January 13, 2015, Tuesday | Online Edition

CHINA'S trade in goods expanded 3.4 percent from a year earlier to US$4.3 trillion in 2014, cementing the country's status as the world's largest trading nation, data from the General Administration of Customs showed today.

Trade surplus shot to a record high of US$382.4 billion last year, or 2.35 trillion yuan, which was up 45.9 percent year on year.

Zheng Yuesheng, a spokesman at the Customs, said although it was the third straight year for China to miss its trade growth target of 7.5 percent, the performance remained positive with a better goods structure and more diversified trading partners.

"The failure to meet the target is due to a couple of complicated reasons, including the condition that China is amidst a transition period and a state of new normal," Zheng said. "With recovering external demand, we expect this year's trade will be better than that in 2014."

Talking about the surging trade surplus, Zheng said China means to keep balance between exports and imports.

"The sharp declines in commodity prices and frail domestic demand have led to weak imports in 2014, which in part landed such a strong surplus."

Last year as whole, China's exports rose 6.1 percent annually to US$2.34 trillion, while imports only edged up 0.4 percent to US$1.96 trillion.

Imports continued to underperform in December. The official data showed imports lost 2.4 percent last month, versus the drop of 6.7 percent in November; In comparison, exports gained 9.7 percent, better than November's rise of 4.7 percent.

Zhou Hao, an economist at Australia & New Zealand Banking Group Ltd, said the falling prices of commodities, especially of energy, were to explain the weak imports and swelling surplus.

"In volume term, Chinese crude oil imports grew 13.4 percent in December, indicating Chinese oil companies intended to take advantage of low prices to raise reserve," Zhou said, adding iron ore imports also rebounded to increase 18.4 percent.

"Despite the large trade surplus, the Chinese yuan only depreciated by about 3 percent in 2014...we believe it is not in central bank's interest to see the yuan weaken significantly as it could trigger large capital outflow, which in turn endanger financial stability," Zhou said.

Wang Tao, an economist at UBS, also expected the yuan to depreciate slightly this year to counter the effect of other weakening currencies.

In 2014 as a whole, the European Union, the United States and the Association of Southeast Asian Nations were the top three trading partners of China, the Customs said.

Compared with the US, whose trade rose 3.3 percent in the first 10 months of last year, and Japan, which saw its trade lost 1.4 percent during the first 10 months, China remained a star performer in terms of exports and imports, the Customs said.

Economy


 

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