German media: China's exports surged in July, what's the reason

China's exports increased significantly in July, exceeding previous expectations. Reuters reported that this shows manufacturers are taking full advantage of the "truce" in tariffs between China and the US, rushing to ship and transfer goods. Chinese media also mentioned the "rushing exports" and the low base effect in their reports, but this growth is unlikely to be sustained.

According to data released by the General Administration of Customs of China on Thursday (August 7), China's overall exports, measured in U.S. dollars, increased by 7.2% year-on-year in July. Reuters reported that this figure exceeded previous expectations, with Reuters previously predicting a figure of 5.4%.

Reuters pointed out that the latest figures show manufacturers are taking full advantage of the current tariff "truce" between China and the US, shipping goods to Southeast Asia and other regions before the US imposes stricter tariffs on transshipment goods.

The current tariff "truce" between China and the US will expire on August 12. Global traders and investors are watching to see whether China and the US can reach a lasting trade agreement before August 12, and whether global supply chains will face another shock from high tariffs.

US President Trump has issued an executive order starting from Thursday, which states that any goods deemed to be transshipped from third countries to avoid high tariffs will be subject to an additional 40% import tariff.

"Trade data shows that the Southeast Asian market is playing an increasingly important role in Sino-US trade," said Xu Tianchen, an economist at the Economist Intelligence Unit, to Reuters.

"I have no doubt that Trump's transshipment tariffs are targeting China, as this was already an issue during Trump's first term. China is the only country that has a reason to transship, because China still enjoys a cost advantage in production, and it still pays much higher tariffs than other countries," Xu Tianchen added.

Source: DW

Original: www.toutiao.com/article/1839810611679235/

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