China diverting exports but eager to avert trade war threat in first meeting since Trump unveiled punishing levies.
China reported that its exports rose more than expected in April as it prepares for weekend talks over tariffs with the United States.
Outbound shipments from the world’s second-largest economy registered a year-on-year rise of 8.1 percent last month, according to government data published on Friday. The result was substantially higher than the 2 percent predicted by economists amid the trade war with the US started by President Donald Trump.
The rise in overall exports in April came despite a 21 percent drop in sales to the US, after Trump announced a general tariff of 145 percent on Chinese goods.
China appears to have succeeded in efforts to pivot to other markets, said analysts.
“Reports of the death of China’s exports look to be greatly exaggerated,” said Lynn Song, chief economist for Greater China at Dutch bank ING. “However you slice it, the data looks better than most market participants expected.”
The figures may also have been buoyed by demand for materials from overseas manufacturers rushing out goods during a 90-day pause on the US tariffs.
Economist Zichun Huang, of Capital Economics, warned that China’s export growth could “turn negative” later this year, with exports to the US set for “further declines” over the coming months, “not all of which will be offset by increased trade with other countries”.
Risk of isolation
The data was released a day before China’s trade envoy He Lifeng is due to sit down with US Treasury Secretary Scott Bessent in the Swiss capital Geneva.
The talks will be the first official engagement between Beijing and Washington on trade since Trump slapped the 145 percent tariff on Chinese goods, prompting a retaliatory 125 percent duty from China.
The Reuters news agency, quoting unnamed sources, reported that behind closed doors, Chinese officials have grown increasingly alarmed about the effect of the tariffs war on the economy, and the risk of isolation as China’s trading partners have started negotiating deals with Washington.
The lead-up to the Geneva talks has highlighted the different negotiating approaches on either side, with Trump reportedly pushing for direct talks with Chinese President Xi Jinping.
That proposal was rejected, partly because Beijing was spooked by Trump’s public berating of Ukrainian President Volodymyr Zelenskyy in February, according to one source quoted by Reuters.
According to the source, any unscripted hostile interaction between the US and Chinese leaders would be seen as an unacceptable loss of face for Xi.
“Both sides I think are balancing, trying to look tough with not wanting to be responsible for sinking the global economy,” said Scott Kennedy, an expert in Chinese business affairs at the Center for Strategic and International Studies in Washington.
