China has surprised the whole world by defying the estimates of increase in American tariffs after Donald Trump is sworn in as the President of America on January 20. China’s exports jumped 10.7 percent last month compared to a year earlier. This is more than anticipated. According to PTI news quoting AP, economists had estimated that it would increase by about 7%. Let us tell you, America’s newly elected President Donald Trump has threatened to impose new tariffs after assuming office.
If high tariff is implemented then prices will increase in America
According to the news, imports increased by 1% year-on-year. Analysts had predicted a decline of about 1.5%. With exports increasing more than imports, China’s trade surplus increased to US$104.84 billion. According to the report, there is a possibility of higher tariffs. Trump has promised to raise tariffs on Chinese goods and close some loopholes that exporters now use to sell their products more cheaply in the US. If higher tariffs go into effect, prices in the US would likely rise and sales and profit margins for Chinese exporters would decrease.
China’s exports likely to remain strong in the near future
Jichun Huang of Capital Economics said China’s exports are likely to remain strong in the near term, as businesses try to front-run potentially higher tariffs. Outbound shipments are likely to remain resilient in the near term due to further gains in global market share due to the weak real effective exchange rate, they wrote in a note. Huang also said that if Trump follows through on his threat to impose tariffs, exports may weaken at the end of the year.
Record exports and total trade
Officials in Beijing said the total value of China’s imports and exports reached a record 43.85 trillion yuan (about $6 trillion), up 5% from a year earlier. Wang Lingjun, Deputy Director General of the Customs Administration, said China is the world’s largest exporter and main trading partner of more than 150 countries and regions. China’s exports of mechanical and electrical products grew by nearly 9% from last year, with exports of high-end equipment rising by more than 40%, the report said on Monday.
Exports of electric vehicles increased by 13%, exports of 3D printers increased by nearly 33% and shipments of industrial robots increased by 45%. E-commerce trade, including sales from companies such as Teemu, Shein and Alibaba, hit 2.6 trillion yuan ($350 billion), more than double the 2020 level.
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