China exports beat forecasts in June after U.S. tariff truce
By Mary Yang and Matthew Walsh
China's exports rose more than expected in June, official data showed Monday, after Washington and Beijing agreed a tentative deal to lower swinging tariffs on each other.
Data from the General Administration of Customs said exports climbed 5.8 percent year-on-year, topping the five percent forecast in a Bloomberg survey of economists.
Imports rose 1.1 percent, topping the 0.3 percent gain predicted and marking the first growth this year.
China's exports reached record highs in 2024 -- a lifeline to its slowing economy as pressures elsewhere mounted.
Beijing's efforts to sustain growth have been hit by a bruising trade war with the United States, driven by President Donald Trump's sweeping tariffs, though the two de-escalated their spat with a framework for a deal at talks in London last month.
Monday's customs figures showed Chinese exports to the United States surged 32.4 percent in June, having fallen the month before, according to an AFP calculation based on official data.
"Growth in export values rebounded somewhat last month, helped by the U.S.-China trade truce," Zichuan Huang, China economist at Capital Economics, said. "But tariffs are likely to remain high and Chinese manufacturers face growing constraints on their ability to rapidly expand global market share by slashing prices.
"We therefore expect export growth to slow over the coming quarters, weighing on economic growth," she added.
Customs official Wang Lingjun told a news conference on Monday that Beijing hoped "the U.S. will continue to work together with China towards the same direction", state broadcaster CCTV reported.
The tariff truce was "hard won", Wang said. "There is no way out through blackmail and coercion. Dialogue and cooperation are the right path."
Analysts say China's economy is expected to have expanded more than five percent in the second quarter thanks to its strong exports. Official figures are due to be released on Tuesday.
But they also warn Trump's trade war could cause a sharp slowdown in the final six months of the year.
Beijing is targeting an overall expansion of around five percent this year -- the same as last year but a figure considered ambitious by many experts.
First-quarter growth came in at 5.4 percent, beating forecasts and putting the economy on a positive trajectory.
Beijing has struggled to sustain growth since the pandemic as it battles a prolonged debt crisis in the property sector, chronically low consumption and high youth unemployment.
Data released last week showed that consumer prices edged up in June, barely snapping a four-month deflationary dip, but factory gate prices dropped at their fastest clip in nearly two years.
Many economists argue that China needs to shift towards a growth model propelled more by domestic consumption than the traditional key drivers of infrastructure investment, manufacturing and exports.
Beijing has introduced a slew of measures since last year in a bid to boost spending, including a consumer goods trade-in subsidy scheme that briefly lifted retail activity.
© 2025 AFP
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Nikkei Asia
20 minutes ago
- Nikkei Asia
Global views of China improve but remain negative: Pew survey
Global perceptions of China remain unfavorable, but have improved since last year. © Reuters PAK YIU NEW YORK -- Public opinion toward China across many countries has improved in the past year but continues to be unfavorable, a new Pew Research Center survey shows, while views of the U.S. have worsened. The proportion of respondents expressing positive views regarding China increased in 15 of 25 countries surveyed by the nonpartisan think tank, while confidence in Chinese President Xi Jinping rose in 16 countries.
Nikkei Asia
an hour ago
- Nikkei Asia
Apple inks $500m deal with MP Materials for rare earth magnets
(Reuters) -- Apple has signed a $500-million deal with Pentagon-backed MP Materials for the supply of rare earth magnets, an agreement underscoring corporate America's growing alignment with U.S. industrial policy support for critical minerals projects. MP shares jumped 19% on Tuesday morning to an all-time high, while Apple's stock gained just under 1%. The multi-year supply deal, announced on Tuesday, is part of a broader push by Apple to bring iPhone production to the United States amid a push from the Trump administration to produce fewer electronics in China. MP last week agreed to a multibillion-dollar deal with the U.S. Department of Defense that will see the Pentagon become MP's largest shareholder and financial backstop. Rare earths are a group of 17 metals used to make magnets that turn power into motion, including the devices that make cellphones vibrate. They are also used to make weapons, electric vehicles, and many other electronics. China halted rare earths exports in March following a trade spat with U.S. President Donald Trump that showed some signs of easing late last month, even as broader tensions underscored demand for non-Chinese supply. As part of the agreement, Apple will pre-pay Las Vegas-based MP Materials $200 million for a supply of magnets slated to begin in 2027. The magnets will be produced at MP's Fort Worth, Texas, facility using magnets recycled at MP's Mountain Pass, California, mining complex, the companies said. "Rare earth materials are essential for making advanced technology, and this partnership will help strengthen the supply of these vital materials here in the United States," Apple CEO Tim Cook said in a statement. Bob O'Donnell, president at market research firm TECHnalysis Research, said Tuesday's move "makes complete sense" given that Apple requires significant amounts of rare earth magnets for its devices. "Plus, by focusing on a U.S.-based supplier, it does help position Apple more positively in Washington," he said. Apple, which said the deal is part of its $500-billion four-year investment commitment to the U.S., has faced threats from Trump over iPhones not made in the U.S. But many analysts have said making the iPhone in the U.S. is not possible, given labor costs and the existing smartphone supply chain. MP already produces mined and processed rare earths and has said it expects to start commercial magnet production in its Texas facility by the end of this year. Last week's deal with the U.S. government includes a price floor for rare earths designed to spur investment in domestic mines and processing plants, which has been lagging partly due to low prices set in China.
The Diplomat
2 hours ago
- The Diplomat
China's Cultural Offensive: How Beijing Is Quietly Reshaping North Korea
As the United States steps back from promoting democracy in North Korea through information campaigns, China is seizing this strategic opportunity to fill the void. Through a sophisticated approach spanning technology, media, education, and economic integration, Beijing is quietly working to reshape North Korean society and bring it under Chinese cultural influence. The 'Cultural Development and Cooperation' Program At the heart of China's strategy lies a secretive initiative called the 'program for mutual cultural development and cooperation,' developed between late 2023 and early 2024. This program, spearheaded by China's propaganda departments in the northeastern provinces of Liaoning, Jilin, and Heilongjiang, represents far more than simple cultural exchange. According to Daily NK sources familiar with the program, its true purpose is to foster pro-Chinese sentiment and spread Chinese culture in North Korea, building a foundation for a shared identity between the two countries. The program was formalized following a visit by a cultural delegation from Liaoning province, led by Liu Huiyan, director of the Propaganda Department of the Chinese Communist Party's Liaoning Provincial Committee. While publicly framed as 'cultural exchange,' the initiative's actual objective is creating what sources describe as 'an ideologically and psychologically friendly environment in North Korea.' As one Daily NK source explained, 'China believes there is no means of control as important as culture.' This philosophy drives a comprehensive strategy targeting multiple segments of North Korean society, including ordinary citizens, young people, regional officials, those with overseas experience, and border region residents. The program also focuses on North Korean students, trade officials, workers, trainees, and diplomatic families already present in China. Technology as a Trojan Horse China's approach cleverly leverages technology to penetrate North Korean society. A striking example is the popularity of Chinese-made MP7 and MP8 media players among North Korean teenagers. These devices, produced by Chinese small and medium enterprises, appear to be simple educational tools but provide access to foreign media content including movies, TV shows, and music. What makes these devices particularly effective is their design sophistication. They allow users to disable FM radio and Wi-Fi functions to avoid detection by North Korean authorities, demonstrating that their Chinese designers clearly understand the realities inside North Korea. Ironically, these devices have become a pathway for South Korean media to reach North Korean audiences – with South Korean content essentially hitchhiking on Chinese hardware. Building on this success, China plans to actively distribute Chinese-made MP5 players and Enhanced Versatile Discs throughout North Korea. The strategy involves continuously feeding audiovisual materials that emphasize 'socialist civilization' into North Korea, including documentaries about the founding of the People's Republic of China, films about the anti-Japanese struggle, and contemporary dramas. China also plans to translate content showcasing Chinese lifestyles and culture into Korean, specifically using the North Korean dialect to respect the North Korean government's desire to preserve the 'Pyongyang Cultural Language.' The 'Culture Bomb' Strategy China's media penetration strategy is both sophisticated and overwhelming. Rather than attempting to measure North Korean responses to specific content, China has adopted what can be described as a 'culture bomb' strategy – overwhelming through sheer volume. The Chinese believe that since any Chinese media will seem fresh to North Koreans, what matters isn't what they watch, but how frequently they watch it. This approach capitalizes on North Korea's current media environment. According to a 2024 survey by the Unification Media Group of 100 North Koreans, 88.4 percent of respondents identified 'China' as the source of the foreign cultural content they consumed. Beijing recognizes that North Koreans feel less threatened by Chinese media than by content from South Korea or the United States, viewing Chinese cultural content as relatively safe. The delivery methods are varied and discreet. China explores multiple channels to get media content into North Korea, including sending USB drives, SD cards, and MP5 video players through traders or other North Koreans traveling to China. The goal isn't just for North Koreans to consume Chinese content, but for them to become familiar with Chinese culture and view it as part of their daily lives. Educational and Economic Integration China's influence extends beyond media into education and economics. At Pyongyang University of Science and Technology, China maintains rotating faculty positions for Chinese professors and helps shape the curriculum. China is also developing an online education platform focused on advanced fields like smart agriculture, applied statistics, and basic medicine. This approach seems designed to 'sinicize' knowledge production – essentially ensuring that North Korea's next generation of skilled workers are trained within China's intellectual framework. Economic integration represents another crucial pillar of China's strategy. Growing cooperation between North Korea's Mangyongdae Trading Company and Chinese electronics firms on semiconductors and displays demonstrates this integration in action. North Korea provides rare earth materials while China supplies key components. The two sides are also working together on trade infrastructure, optimizing logistics, and implementing encrypted payment systems. This goes beyond simple trade expansion – it's really about realigning North Korea's tech industry with Chinese standards. China aims to gradually integrate North Korea into Northeast Asian industrial and supply chain networks, which would give China greater influence down the road. Additionally, China provides unofficial economic support by overlooking smuggling and allowing North Korean workers to remain in the country, despite international sanctions. Managing Defections and Border Control China employs a sophisticated cultural strategy that serves as both soft power projection and practical border management. This approach reflects Beijing's pragmatic understanding that completely preventing North Korean defections is neither possible nor entirely desirable, given the economic benefits of North Korean labor. Instead, China aims to channel these population movements in ways that serve its strategic interests while maintaining North Korean regime stability. China's cultural campaign works to normalize Chinese society in North Korean minds through widespread distribution of Chinese media content. By improving perceptions of China among North Koreans, Beijing ensures that those who do cross the border are more likely to view China as a permanent destination rather than merely a transit point to South Korea. This cultural influence makes potential defectors more inclined to settle in China rather than continuing their dangerous journey south. China fully understands that exposure to Chinese content leads North Koreans to think 'China is better,' but believes it can manage this through what amounts to controlled aspiration. The implicit message is clear: 'You can see Chinese content, but we control the border – don't try to cross.' Unlike American or South Korean media that promotes freedom and democratization, Chinese content is carefully designed to maintain the status quo while gradually fostering identification with Chinese culture. China's confidence in this approach stems from its belief in its superior border surveillance capabilities. The ultimate goal is ensuring that those North Koreans who do defect remain within China's sphere of influence rather than becoming advocates for Western democratic values elsewhere. This strategy allows China to benefit from North Korean labor while preventing defectors from strengthening pro-democratic movements or providing intelligence to Western nations. The Strategic Moment China views the current moment as strategically important, particularly with the potential for the United States to suspend support for North Korean human rights initiatives under President Donald Trump. As one Daily NK source explained, 'China sees this as a strategically important moment, with the U.S. turning away from information warfare efforts, including the suspension of radio programming into North Korea. They view this as a genuine opportunity to deepen their influence over North Korea.' China may be pleased by signs that the United States is voluntarily abandoning its democracy promotion campaign. If U.S.-backed content dissemination efforts lose momentum, China will become the only significant content provider – an ideal opportunity to spread its own culture. China is also preparing to use this program as a diplomatic tool, recognizing that if North Korean officials and young people develop positive attitudes toward China, that could strengthen pro-China policies. Implications for the Future The real question facing the international community is who will drive social change inside North Korea. If the United States and other Western countries cut democracy promotion funding and abandon this approach, the initiative for genuine change in North Korean society will shift to China. This would inevitably weaken the emotional bonds and cultural ties that come from sharing language and heritage between North and South Korea. China's long-term plan is to cultivate a shared cultural identity between the two countries, believing that over time, Chinese media will begin feeling more familiar and comfortable to North Koreans. As China gradually reshapes North Korea to bring it under Chinese influence, South Korea and the international community haven't responded effectively. If South Korea stops trying to connect with North Korean hearts and minds, China will naturally step into that role. The outcome of this cultural competition may ultimately determine North Korea's future trajectory.
