Despite political and economic tensions in recent months (and years!) trade between China and the US, the world’s two largest economies, surged in April showing signs of further global economic recovery as well as improving relations.
Exports from China to the US saw a year-on-year increase of 31% in April. Equating to $42.95 billion worth of goods and services, the export surge was mainly a result of increasing demand for consumer electronics and other high-tech products made in China.
It wasn’t just exports that saw a hike. On the contrary, imports from the US also rose significantly, experiencing a year-on-year increase of 52% to $13.94 billion. This was mainly the result of increased demand in China for integrated circuits and other raw materials.
The upward trajectory of China’s trade with the US is indicative of global trends. April also saw surging increases in Chinese exports to all corners of the world, with the export driven economy continuing their impressive Covid bounce-back. In the first quarter of 2021, the Chinese economy recorded a staggering year-on-year growth rate of 18.3%.
THINK LIKE AN ECONOMIST!
Q1. What was the trade balance between China and the US in April this year?
Q2. Explain what is meant by the phrase “export driven economy”.
Q3. Analyse the possible reasons for why economic growth in China was so high in Q1 2021.
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