China’s exports to the United States significantly dropped in April, while its trade with other economies increased, indicating that President Donald Trump’s tariffs are accelerating changes in global supply chains. Total exports from China rose by 8.1% last month compared to the previous year, faster than the 2% growth anticipated by most economists. However, this growth rate was slower than the 12.4% increase in March. Imports fell by 0.2% in April compared to the previous year. Shipments to the U.S. decreased by 21% in dollar terms as Trump’s tariffs on Chinese exports reached as high as 145%. With Chinese tariffs on U.S. goods at 125%, trade between the two largest economies has become increasingly uncertain. China’s imports from the U.S. dropped by more than 13% from the previous year, while its trade surplus with the U.S. was nearly $20.5 billion in April, down from about $27.2 billion the previous year. In the first four months of the year, China’s exports to the U.S. fell by 2.5% compared to the previous year, while imports from the U.S. fell by 4.7%. A potential resolution to the tariff stalemate could occur soon, with Treasury Secretary Scott Bessent and other senior trade officials meeting with Chinese officials in Geneva. However, disagreements over strategic interests may hinder progress in talks. Some punitive tariffs, including Beijing’s retaliatory 125% tariffs on U.S. exports, might be reduced, but a full reversal is unlikely, according to Zichun Huang of Capital Economics. This suggests further declines in China’s exports to the U.S. over the coming months, not all of which will be offset by increased trade with other countries. The rapid increase in Chinese exports to other countries reflects a restructuring that began years ago but has gained momentum due to Trump’s trade barriers. Global manufacturers are seeking alternatives to reduce reliance on manufacturing in China, especially after disruptions caused by the COVID-19 pandemic. Exports to the U.S. accounted for about a tenth of China’s total exports in April, with the European Union and Southeast Asia being larger regional export markets. Trade with the 15-nation Regional Comprehensive Economic Partnership (RCEP), which excludes the U.S., is even larger. Exports to countries involved in China’s ‘Belt and Road Initiative’ are also significant. In the first four months of the year, exports to the Association of Southeast Asian Nations rose by 11.5%, and those to Latin America climbed by the same percentage. Shipments to India increased by nearly 16%, and exports to Africa surged by 15%. Some of the fastest growth was seen in Asia, particularly with exports to Vietnam rising by 18% year-on-year and to Thailand by 20%. Preliminary data show a decline in shipping and trade activity in China. Beijing recently announced measures to counter the impact of the trade war on its economy, which is already struggling after the pandemic and a downturn in its housing sector.
— new from AP News
