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China's exports have risen by 5.1% to $185.99 billion in July, recovering from a tumble in June as markets showed signs of a turnaround due to credit support and stability in the US and EU countries, the main markets of the world's largest trader.
Imports also rebounded from a tumble in June, gaining 10.9% to $168.17 billion, the General Administration of Customs said in a statement.
Total foreign trade grew 7.8% in July year-on-year to $354.16 billion, after it recorded a decline of 2% in June.
The trade surplus narrowed by 29.6% year-on-year to $17.82 billion last month, as import gains outpaced export gains, customs data showed.
Liu Ligang of the ANZ Banking Group said that the country's foreign trade improved in July mainly due to a low base figure in the same period last year, more credit support to foreign trade companies, and a recent recovery in the United States and the European Union (EU).
In July, two-way trade with the EU and the United States rose by 5% and 10% respectively, as compared with a year-on-year drop of 5.4% and 8.3% respectively in June, state-run Xinhua news agency reported.
Lian Ping, chief economist at the Bank of Communications, said western importers have started placing orders for the Christmas season, which drove China's July exports. August exports are expected to rise as well for the same reason.
China virtually supplies Christmas decoration and gift markets to the whole of the world.
Data from China Federation of Logistics and Purchasing showed that the sub-index for new export orders was up by 1.3 percentage points from June, to 49% in July.
Zhang Liqun, an analyst with the Development Research Centre of the State Council, said market expectations for China's stabilised economic growth have been strengthening and exports are expected to improve slightly in the second half. The country has set a target of 8% increase in foreign trade this year.
Zhuang Jian, an Asian Development Bank economist, expected China's foreign trade to perform better in the second half, but said great difficulties and uncertainties still lie ahead. China should continue to optimise its export structure, enlarging the share of electronic and machinery products, he told Xinhua.
Exports of electronic and machinery products grew by 4% to reach $102.85 billion in July, accounting for 55.3% of total exports, as compared to 57.8% in the first half.
Liu Ligang said a long-expected detailed plan on building a pilot free trade zone in Shanghai is likely to be announced in late August or early September, which will give a boost to the service trade. But Liu warned a rising yuan will continue to hinder China's exports in the second half of the year.
Liu said the Chinese yuan has been strengthening even though the country's economic recovery is weak.
China's economy has been stuck in a protracted weak recovery, easing to 7.5% growth in the second quarter from 7.7% in the first three months and 7.9% in the final quarter of 2012.
