China's export surge angers the world! Trade surplus expected to exceed $1.2 trillion, another record

China's exports increased by more than 36% year-on-year in September. (Reuters)

[Compiled by Wei Guojin/Taipei Report] Data released by China's General Administration of Customs on the 14th showed that China's exports increased by 36.3% annually in September, the largest increase since February, much higher than the 25% annual increase in August and the 25.5% growth expected by analysts. China's trade surplus this year is expected to exceed last year's nearly 1.2 trillion US dollars, reaching a new high, which may intensify trade tensions with major trading partners.

China's imports rose at an annual rate of 31% in September, up from a 28.2% annual increase in August and higher than the 24.5% increase forecast by economists.

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China's trade surplus exceeded US$1 trillion in November last year, and was US$1.19 trillion for the whole year. In the first nine months of this year, the trade surplus has reached US$938.11 billion. Unless exports slow down significantly in the last quarter, it is expected to hit the US$1 trillion threshold sooner. At present, the possibility of this slowdown is unlikely.

"Reuters" reported that China's trade surplus expanded to US$133.53 billion in September, mainly due to a trade surplus of US$34.01 billion with the United States, a 20-month high, and a US$34.8 billion surplus with the European Union.

The EU and China reached an agreement earlier this month to limit the number of Chinese gasoline-electric hybrid vehicles exported to Europe. However, this trade measure may not be formally implemented until December, so exporters are expected to increase shipments before the deadline.

Nguyen Hoang Nam, China economist at Capital Economics, pointed out that the expansion of China's trade surplus with Europe may trigger the EU to introduce broader restrictions than last week's agreement, but it is expected that the relevant measures will have little impact on the Chinese economy.

High-tech products and automobiles continue to support China's exports. In the first nine months of this year, semiconductor exports increased by 108.1% year-on-year, and automobile exports and export volume both increased by more than 50%. With the rollout of artificial intelligence (AI) infrastructure showing no signs of slowing down, analysts expect demand for Chinese technology products, such as semiconductors, to remain strong.

Bloomberg analyst David Qu pointed out that China’s strong trade data in September concealed a deepening imbalance in the export industry. The expansion of global AI and the production capacity of China's technology products continue to drive strong growth in hardware shipments. However, traditional export industries such as apparel, furniture, and toys lag behind, despite a low base period that boosted annual figures.

Zhou Hao, chief economist at Guotai Junan, said the size of September's surplus highlighted the strength of China's export industry, although doubts about domestic demand still linger.

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