July 2011 figures

China exports, imports grew faster-than-expected in July
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From K J M Varma
Beijing, Aug 10 (PTI) China reported faster-than-expected growth in exports, imports and its trade surplus in July, but analysts said the picture could become worse in the coming months amid uncertainty in the global economy triggered by the US debt crisis and escalating inflation.
China''s trade surplus rose sharply to USD 31.48 billion in July from USD 22.27 billion in June and USD 28.7 billion in the same month a year ago.

Exports rose 20.4 per cent year-on-year in July to reach USD 175.128 billion, a new record, China''s General Administration of Customs (GAC) said.

Imports also increased by 2.9 per cent to USD 143.64 billion in July. China''s imports had registered a growth rate of 19.3 per cent in June.

The readings suggest that both China''s export competitiveness and domestic demand are in relatively good shape, Bank of America-Merrill Lynch economist Lu Ting said.

Exports to the European Union (EU) and Japan rose by 22.3 per cent and 27.2 per cent year-on-year in July from 11.4 per cent and 20 per cent in June.

Growth in overseas shipments to the United States stood at 9.5 per cent in July, 2011, down slightly from 9.8 per cent in June, but down significantly from the average 13.3 per cent growth rate witnessed in the second quarter and 21.4 per cent in the first quarter, which indicated the US weakness has been weighing on its imports from China, Xinhua quoted Lu as saying.

The pain of the external turmoil will gradually be felt by Chinese exporters during the rest of the year, as the sovereign debt crisis in the EU and credit downgrade in the United States has generated more uncertainty about the recovery of the global economy, analysts said.

According to Lu, China''s export and import growth will slow to 16 per cent and 23 per cent, respectively, in the second half of this year from 24 per cent and 27.6 per cent in the first half.
The trade surplus will increase to USD 97.2 billion, up from USD 46 billion in the first half.
Import growth will trend down on the back of declining commodity prices and soft landing of the domestic economy, he said.

On the domestic front, China''s inflation rate accelerated to 6.5 per cent, a 37-month high, in July on surging food costs, while its Producer Price Index (PPI), a major measure of inflation at the wholesale level, rose by 7.5 per cent amid deepening worries over the downgrade of US debt.