China's Exports to US Sink    05/09 05:38

   China's exports to the United States tumbled in April while its trade with 
other economies surged, suggesting that President Donald Trump's tariffs 
offensive is hastening a shakeup in global supply chains.

   (AP) -- China's exports to the United States tumbled in April while its 
trade with other economies surged, suggesting that President Donald Trump's 
tariffs offensive is hastening a shakeup in global supply chains.

   Total exports from China rose 8.1% last month from a year earlier, much 
faster than the 2% pace most economists had been expecting. That was much 
slower than the 12.4% year-on-year increase in March. Imports fell 0.2% in 
April from the year before.

   Shipments to the U.S. sank 21% in dollar terms as Trump's tariffs on most 
Chinese exports rose to as high as 145%. With Chinese tariffs on U.S. goods at 
125%, business between the two biggest economies has grown increasingly 
uncertain.

   China's imports from the U.S. dropped more than 13% from a year earlier, 
while its politically sensitive trade surplus with the United States was nearly 
$20.5 billion in April, down from about $27.2 billion a year earlier.

   In the first four months of the year, China's exports to the United States 
fell 2.5% from a year earlier, while imports from the U.S. fell 4.7%.

   A potential break in the tariffs stalemate could come as soon as this 
weekend. Treasury Secretary Scott Bessent and other senior trade officials are 
due to meet with Chinese officials in Geneva on Saturday. But Beijing and 
Washington are at odds over a raft of issues, including colliding strategic 
interests that will may impede progress in the talks.

   Some of the punitive tariffs, including Beijing's retaliatory 125% tariffs 
on U.S. exports, could be rolled back, but a full reversal is unlikely, Zichun 
Huang of Capital Economics said in a report.

   "This means China's exports to the U.S. are set for further declines over 
the coming months, not all of which will be offset by increased trade with 
other countries. We still expect export growth to turn negative later this 
year," Huang said.

   Whatever the outcome of those discussions, the rapid increase in Chinese 
exports to other countries reflects a restructuring that began years ago but 
has gained momentum as Trump has raised barriers to exporting to the U.S.

   Global manufacturers have been looking for alternatives to a near total 
reliance on manufacturing in China after disruptions from the COVID-19 pandemic 
highlighted the need for more diverse options.

   The need for more versatile supply chains grew more apparent as Trump hiked 
tariffs on Chinese exports during his first term in office. Most of those 
remained during former President Joe Biden's term.

   Exports to the United States accounted for about a tenth of China's total 
exports in April and the U.S. is still China's largest single-country market. 
But the European Union and Southeast Asia are larger regional export markets.

   Trade with a broader grouping, the 15-nation Regional Comprehensive Economic 
Partnership (RCEP), which does not include the United States, is still bigger. 
And exports to countries participating in China's "Belt and Road Initiative," a 
vast network of Beijing-supported infrastructure projects, are bigger still.

   In the first four months of the year, exports to the 10-nation Association 
of Southeast Asian Nations rose 11.5% from a year earlier, and those to Latin 
America also climbed 11.5%. Shipments to India jumped nearly 16% by value, and 
exports to Africa surged 15%.

   Some of the fastest growth was in Asia, reflecting moves by Chinese and 
other manufacturers to diversify their supply chains outside of the Chinese 
mainland. Most notable were exports to Vietnam, which jumped 18% year-on-year. 
Exports to Thailand were up 20%.

   Back in China, preliminary data have shown a sharp decline in shipping and 
other trade activity. Earlier this week, Beijing announced a barrage of 
measures meant to counter the impact of the trade war on its economy, which was 
already struggling to regain momentum after the pandemic and a lengthy downturn 
in its housing sector.