MNI ANALYSIS: China's Export Growth Accelerates In September

     BEIJING (MNI) - A surge in exports to the U.S and Europe helped push

China's trade surplus higher for a third straight month, despite the country's

dispute with Washington, official data published Friday shows.

     Export values rose 14.5% y/y in September to USD226.69 billion, beating

MNI's survey estimate of a 9.0% gain. Over the first nine months of the year,

exports were up 12.2% y/y to USD1.83 trillion (following expansion of 5.4% in

Jan-Aug).

     Steady growth in foreign sales has been supported by resilient demand

across export markets, including the U.S., the EU and China's OBOR partners,

Customs spokesman Li Quiwen stated.

     Export growth to the U.S. accelerated to 14% y/y from 13.2% in August,

while imports from the U.S. contracted by 1.2% y/y - the first decline since

February. This left China's trade surplus with the U.S. at a record high

USD34.13 billion.

     Exports to the EU increased by 17.4% y/y in September (up from 8.4% in

August), while sales to Japan were up 14.4% y/y.

     Recent currency depreciation has supported sales - the yuan has weakened by

over 4.4% since the start of July, coinciding with the escalation in the

U.S.-China trade conflict.

     --STEADILY GROWING IMPORTS

     Imports rose for the 23rd consecutive month, although the pace of growth

moderated to 14.3% y/y in September, from 27.3% in July and 20.0% in August.

Imports amounted to USD1.61 trillion over the first three quarters of the year,

up by 20% on a y/y basis.

     Beijing has announced a series of measures to support import growth,

including a reduction in import taxes for consumer goods. As such, imports are

likely to continue to rise going forward.

     China's total trade surplus expanded to USD31.69 billion in September from

USD27.91 billion in August. The Jan-Sep surplus stood at USD221.38 billion.

     --TRADE CONFLICT IMPACT

     Ongoing trade frictions have had some negative impact on China's external

sector, but both the direct and indirect effects are "basically under control,"

the General Administration of Customs' spokesman and also director of its

statistical analysis division, Li Kuiwen, said at a conference in Beijing.

--MNI London Bureau; +44208-865-3829; email: Jason.Webb@marketnews.com

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