China’s exports jumped more than expected in March as businesses frontloaded outbound shipments to avoid prohibitive U.S. tariffs, while imports extended declines as sluggish domestic demand persisted.
Exports jumped 12.4% last month in U.S. dollar terms from a year earlier, according to data released by customs authority on Monday, significantly outpacing Reuters’ poll estimates of a 4.4% growth and marking the biggest jump since October last year.
Imports fell 4.3% in March from a year earlier, compared with economists’ expectations of a 2% decline.
In the first two months of the year, China’s exports had slowed more than expected, growing just 2.3% year on year, marking the slowest rise since April 2024. Imports clocked a steeper-than-expected decline of 8.4% from a year ago, their sharpest fall since mid-2023.
“Exports will likely weaken in coming months as the U.S. tariffs [have] skyrocketed,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, adding that “in the short term, I expect chaos in supply chains and potential shortage in the U.S. that may drive up inflation.”
Trade policies remained highly uncertain, compounding challenges for businesses looking to adjust supply chains and capital spending plans, Zhang said. “Even if firms decide to relocate their supply chains, it takes time to build factories.”
The Chinese leadership has set an ambitious annual growth target of “around 5%” this year, a goal seen harder to achieve given the prospects of an escalating trade war and persistently lackluster domestic consumption.
Since U.S. President Donald Trump’s inauguration in January, he has imposed a cumulative 145% tariffs on all imports from China, including a 20% duty allegedly related to Beijing’s role in fentanyl trade.
China has struck back with tit-for-tat tariff increases, including levies of up to 15% targeting select American goods and across-the-board tariffs of 125% in the latest retaliation last Friday.
Lingjun Wang, the vice head of customs administration, said at a press conference Monday that the U.S. government’s “abusive use of tariffs” has created headwinds for global trades, according to a CNBC translation, while repeating Beijing’s call for a negotiation with Washington.
China will “implement all countermeasures announced against the U.S. strictly in accordance with the law,” while continuing to open up its economy for mutually-beneficial trade and investment cooperation with countries around the world, Wang said.
In a relief for many, last Friday the Trump administration granted reprieves for reciprocal tariffs on a slew of electronics products, including smartphones, computers, semiconductors, solar cells and flash drives, according to a notice from the U.S. Customs and Border Protection. The prior 20% fentanyl-related tariff remain in place.
China’s ministry of commerce called the exemptions a “small step by U.S. to correct its wrong practice of unilateral reciprocal tariffs” and urged Washington to cancel the steep tariffs completely.
China’s exports to the U.S. rose 9.1% in terms of total values in March from a year ago, according to CNBC’s calculation of official customs data, while imports from fell 9.5% on year. The U.S. remains its largest trading partner on a single-country basis, accounting for about 10% of China’s total trades.
The country’s exports to Association of Southeast Asian Nations jumped 11.6% last month, particularly outbound shipments to Vietnam surged nearly 19%, while imports from the region grew 9.8%.
Meanwhile, China’s exports to European Union grew 10.3% while imports fell 7.5% from a year earlier.
China’s iron ore imports slumped 6.7% year on year to about 94 million tones in March, the lowest level since 2023, according to Wind Information. Imports of soybeans fell 36.8% to the lowest since 2008, according to Reuters.
Imports of semiconductors and crude oil rose 11.2% and 4.8%, respectively, according to the customs data.
Its exports of semiconductors and rare earths jumped over 25% and 20%, respectively, compared to a year ago.
Calls for stimulus
Pressure has been building on Chinese officials to release more forceful stimulus measures to prop up domestic consumption and the housing market, while reducing the economy’s reliance on exports and investment.
Data released last week showed Chinese consumers have remained reluctant to spend, with consumer prices contracting for a second straight month while producer prices falling for the 29th straight month.
Several investment banks have moved to slash China’s growth forecasts this year citing impacts from the substantial rise in U.S. tariffs on Chinese goods.
Goldman Sachs, the latest to join the ranks last week, expects the world’s second-largest economy to grow just 4.0% this year, down by 0.5 percentage point from its prior forecast. While it anticipates Beijing to further intensify policy easing to counter the tariff disruption, the Wall Street bank believes the measures may not be able to “fully offset the negative effect of the tariffs.”
China is due to release its GDP growth figure for the first quarter on Wednesday, followed by a high-level meeting by its top decision-making body, known as the Politburo, later this month. At the meeting, policymakers are expected to unveil more stimulus measures to boost domestic demand and offset the trade shock.
— CNBC’s Evelyn Cheng contributed to this story.
Source: CNBC