China's 1st quarterly current account deficit in 17 years
5 May 2018 6:25 PM GMT
Beijing: China has recorded its first quarterly current account deficit in nearly 17 years, ending its dream run of accumulating trade surplus as a top exporter for a period during which it amassed the world's largest foreign exchange reserves of over $3.14 trillion. China saw a current account deficit of $28.2 billion in the first quarter of this year, the country's first quarterly deficit since the second quarter of 2001, data released by the State Administration of Foreign Exchange (SAFE) showed.
The goods trade still ran a surplus of $53.4 billion, but registered a 35 per cent slump year-on-year, while the service trade posted a deficit of $76.2 billion, the biggest quarterly deficit since 1998, China's Caixin magazine reported. SAFE tried to play it down saying that the rare red figure in the current account was a result of seasonal factors , but economists said it could signal a fundamental shift in China's international payment position, which in turn is a result of global economic rebalance in the last decade.
Ding Shuang, the chief China economist with Standard Chartered in Hong Kong, wrote in a note that China has run a current account surplus on an annual basis in the past 25 years and people tend to take (China's) surplus for granted.
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