China’s exports grew at the fastest pace this year, rising 9.5% year-on-year, while imports have declined for the second straight month, creating a mixed picture for the Chinese economy. Surprisingly, the sustained export activity in the past few months has been impacted by an early normalization of production in China, accelerated exports of medical equipment and electronics, and financial support measures in other countries. While these effects may persist over the coming months, they are likely to stabilize towards the end of the year.
Stronger-than-expected export figures in August were driven by significant increases in exports to the US and similar Asian countries such as South Korea and Taiwan, while export growth to most European countries slowed from a month ago. In terms of products, the main driving force behind the jump was the export of automatic data processing equipment and mechanical and electronic goods.
The surprisingly steady export activity in the past few months may be attributed to an early normalization of production in China while other countries were still in lockdown mode, accelerated exports of medical equipment and electronic goods as people around the world switched to work from home.
