China's May imports accelerate, exports weaken

By JOE McDONALD | June 10, 2011 | 12:45 AM EDT

BEIJING (AP) — China's import growth accelerated in May despite government efforts to cool an overheated economy, while exports weakened.

Imports rose 21.8 percent, up from April's 28.4 percent and beating most forecasts, data showed. Export growth eased to 19.4 percent from April's 21.8 percent in a sign of weakening global demand.

China's politically sensitive monthly global trade surplus widened to $13 billion, the highest level this year and an increase over April's $11.4 billion but about the same level as a year ago.

Indicators of industrial activity have weakened in recent months as Beijing tightened credit and investment curbs, prompting forecasts of a decline in Chinese demand for oil, iron ore and other imports.

The government is trying to steer the economy toward more sustainable growth following a stimulus-driven boom.

The import strength could help to ease concern that the world's second-largest economy might be headed for a hard landing. Many private sector analysts expect a controlled decline in growth.

May imports were $144.1 billion, while exports were $157.2 billion, the General Administration of Customs reported.

China's economy grew by a rapid 9.7 percent in the first quarter of this year, but other data show manufacturing, bank lending and other activity cooling following four interest rate hikes since October.

A gradual rise in China's yuan against the dollar in recent months could help to support demand for imports by making prices cheaper in local currency terms.

Beijing is under pressure from Washington and other trading partners to ease controls that they complain keep the yuan undervalued and swell China's trade surplus. The government has allowed the currency to rise but not as fast as critics want.

China recorded a trade deficit for the first three months of 2011 and a surplus of just $140 million for March.

Analysts expect China to show a global trade surplus for the year of $160 billion to $200 billion. Last year, China ran a trade surplus of about $16 billion a month.

An index of manufacturing issued by the government-affiliated China Federation of Logistics and Purchasing found new orders, production, new export orders and purchasing prices fell in June.



General Administration of Customs (in Chinese):

(This version CORRECTS Rewrites to correct that May import growth strengthened.)