China posts first double accounts surplus since 2014

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For the first half of 2017, China posted a current account surplus of 69.3 billion US dollars and 67.9 billion US dollars surplus in non-reserve financial accounts, the foreign exchange regulator said on Thursday. This is the first double surplus since 2014.

A surplus in both accounts showed improvements in the economic structure, stable cross-border capital flow and controllable risks in the balance of payments, State Administration of Foreign Exchange (SAFE) said in a half-year report released on Thursday. SAFE also noted that China will see a basic equilibrium in the balance of payments in the second half of the year.

From January to June, China made a surplus of 214.4 billion US dollars in commodity trade, down 8 percent year-on-year.

In the same period, China’s service trade reported a 135.1 billion US dollar deficit, up 24 percent year-on-year.

Foreign direct investment to China saw a surplus of 13.9 billion US dollars in the first six months of this year, compared with a 49.4 billion US dollar deficit in the first half of 2016.

Meanwhile, China’s outward direct investment assets saw a net increase of 41.1 billion US dollars, 67 percent lower than the growth in the same period of last year, the SAFE report said, noting that irrational outward investment has come under control.

Positive factors at home and abroad are together pushing China towards a basic balance of payments equilibrium, SAFE said.

These factors include a recovering global economy, a steady domestic economy and greater opening-up of the financial market.

The SAFE also said it will keep a close eye on the influence of the US Federal Reserve's plan to start unwinding its balance sheet from October as a further step to end its loose monetary policy.