June 8 (UPI) — China’s trade surplus with the United States was up about 11 percent in May and overall Chinese exports of steel and aluminum rose despite an expanding trade war between the two countries.
China’s trade ministry stated Friday its U.S. trade surplus rose to $24.6 billion.
China’s net trade surplus with the United States from January to May 2018 increased $14.85 billion, but the country ran a trade deficit with South Korea in May, that rose to $8.2 billion from $6.1 billion in April, according to Yonhap news agency.
In total, China enjoyed a trade surplus of $24.9 billion. Exports overall grew 12.6 percent in May.
But the growth may not bode well for trade relations with Washington.
Dariusz Kowalczyk, senior emerging-market strategist at Credit Agricole SA in Hong Kong, told Bloomberg the United States could take a tougher stance.
“The optics of the heavy reliance on the U.S. market for surplus generation will be negative in the context of ongoing trade negotiations and could harden the U.S.’s stance and thus reduce odds of a deal,” the analyst said.
Chinese trade data was made public a day after U.S. Commerce Secretary Wilbur Ross said the United States has struck a deal with ZTE, the Chinese telecom company, so U.S. sanctions against the firm could be terminated.
Ross told CNBC the deal includes a $1 billion penalty against ZTE and a compliance team monitoring the company’s activities.
“If they do violate it again, in addition to the billion dollars they are paying us up front, we had them put $400 million in escrow. The total deal is $1.4 billion. That money will be forfeited if they violate anything…and we still retain the power to shut them down again,” Ross said.
Some members of the Trump administration want the president to go easy on China ahead of Tuesday’s summit with North Korea.
The Financial Times reported this week Secretary of State Mike Pompeo wants to avoid an escalation of a trade war with China that could pose risks to the meeting.