China’s trade surplus hit its highest monthly level ever in December, as the country’s exports continued to boom during the coronavirus pandemic.

Exports grew 18.1 percent in dollar terms last month, while imports rose 6.5 percent, pushing the trade surplus to a record $ 78 billion. Both exports and imports exceeded economists‘ expectations in a Bloomberg survey.

China’s exports have benefited from soaring demand for medical products and commodities linked to the closure at a time when global trade is under severe pressure and other large economies struggle to deal with it.

This increase in trade helped boost the Chinese economy, which quickly recovered from the early impact of the epidemic. GDP data to be released early next week is expected to show that the Chinese economy expanded 2.1 percent last year.

Strong export growth continued, including double-digit increases for three consecutive months, despite the strengthening of the renminbi, which this month crossed the 6.5 level against the dollar. For the first time since 2018.

Thanks to the country’s economic recovery and the lure of higher interest rates, foreign investors have been quick to buy Chinese assets over the past year. This resulted in inflows of about 1 trillion RMB ($ 155 billion) in 2020 through Hong Kong programs linking overseas buyers to the mainland. The stock market touched in China this month The highest level since the global financial crisis.

While China’s market share of global trade jumped in the middle of last year on the back of its rapid recovery from the epidemic, analysts indicated that it may decline as other countries recover.

„With the epidemic under control, production increased elsewhere, and consumers shifting to more consumption of services, we think China will face more competition,“ said Tao Wang, head of Asia’s economics research at UBS, this week.

Coronavirus Business Update

How does the Corona virus affect markets, businesses, our daily lives and workplaces? Stay informed with our Coronavirus newsletter.

Register here

But she added that a strong global recovery should support export growth of about 10 percent in China this year.

Imports, which hit their highest level in dollars in September, have risen for four straight months. The economic recovery in China has increased demand for basic commodities. Iron ore imports rose to 1.17 billion tons in 2020, up 9.5 percent from the previous year.

Reported by Wang Xueqiao in Shanghai