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China logs record trade surplus, $116.88 billion, in Feb as manufacturing rebounds
Mon, March 6, 2023 at 6:48 PM EST
By Ambar Warrick
-- China’s trade surplus grew sharply in February, data showed on Tuesday, driven largely by a smaller-than-expected decline in exports as manufacturing activity recovered on fewer COVID-19 disruptions, although the country’s imports also shrank far more than expected.
China’s trade balance rose to a record-high $116.88 billion in February, data from the Customs Administration showed, which was higher than expectations for a surplus of $81.80B, as well as January’s reading of $78.00B.
Exports shrank 6.8% from the prior year, better than expectations for a drop of 9.4% and last month’s reading of 9.9%. The reading indicated that the lifting of anti-COVID measures was helping local manufacturers meet international orders on time.
But manufacturers also have to contend with a potential slowdown in overseas demand for goods.
Local demand still showed few signs of improving from pandemic-era lows, with Chinese imports shrinking 10.2% from last year, nearly twice as much as expectations for a drop of 5.5%, and more than January’s drop of 7.5%.
Tuesday’s reading comes after data last week showed China’s business activity expanded at its fastest pace in over a decade in February, as a post-COVID recovery gathered steam.
Still, the government forecast a smaller-than-expected economic growth target for 2023, at 5%, likely driven by caution over a slowdown in the global economy.
But a robust trade surplus bodes well for the Chinese economy, and is likely to help in fishing growth from pandemic-era lows. Economic indicators released so far show that economic growth has certainly rebounded after the lifting of most zero-COVID restrictions earlier this year.
The Chinese government has also rolled out a slew of stimulus measures to support growth, and has indicated that it will continue doing so this year.
Focus this week is now on Chinese inflation data, which is also expected to show a recovery as the reopening spurred increased spending.
