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China's exports rose by 35.3% to US$20.2 billion, while imports fell by 9.7% to US$15 billion, over the first seven months of 1986. As a result, there was a visible trade surplus of US$5.2 billion
(5)
11.
There are, however, considerable uncertainties facing China's exports in the second half of 1987, mainly because of the less than favourable outlook for its
textiles and clothing exports (6).
Partly as a result of a gross over-utilization of quotas due to poor management of its quota system, and partly because of reports and accusations concerning forged export certificates, 22 categories of China's textiles and clothing exports to the United States were put under embargo. This suggests that the impressive increases in China's textiles and clothing
(5)
(6)
A major source of discrepancy between the MOFERT statistics and the Customs statistics is that the former set of statistics excludes imports by sino-foreign joint ventures, co-operative enterprises and wholly foreign-owned enterprises, inasmuch as such imports are not financed out of China's foreign exchange earnings. Besides, unlike the Customs statistics, imports and exports of goods involved in compensation trade and outward processing arrangements are not taken into account in the MOFERT statistics, and only their value-added content is included. For further details on the discrepancy, see CEC Paper No. 6/85 'A note on China's national income, trade and balance of payments statistics'.
China's Customs statistics for July show that the year-on-year rate of increase in its exports to Hong Kong and Macau and to the United States slowed down to 25% and 4% respectively, from the corresponding average growth rates of 41% and 25% recorded in the first half of 1987.
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