China displaced the US as the largest source of European Union imports last year, official figures showed on Thursday.
The rapid growth in Chinese imports has become politically sensitive in Europe and raised fears about the continent’s industrial competitiveness.
Last year, imports from China into the 25 countries comprising the EU rose by 21 per cent to €191.5bn ($255bn, £130bn), according to Eurostat, the EU’s statistical office. In contrast, imports from the US rose by 8 per cent to €176.2bn.
The EU has also seen strong growth in its exports to China, which rose by 23 per cent last year to €63.3bn.
The rising importance of such trade links explain why economists remain upbeat about Europe’s economic prospects, in spite of the threat of a US slowdown.
Lorenzo Bini Smaghi, executive board member of the European Central Bank, said last week: “For the continued sustained growth of the world economy, a slowdown of Asian economies would be as worrisome, if not more, than that of the US.”
The latest trade figures suggested that the strengthening euro had yet to cause significant damage to exports from the eurozone. Germany’s economic recovery was initially powered by exports, and in France the euro’s rise has sounded alarm bells about export competitiveness.
In January, seasonally adjusted eurozone exports were down 0.4 per cent compared with December but the 13-country region reported a trade surplus for the fifth consecutive month.
The euro has strengthened further against the dollar this week, although it remains below the peak of more than $1.36 hit at the end of 2004. On a trade-weighted basis, the euro is at a two-year high.
For the eurozone, Chinese imports had overtaken imports from the US by the middle of last year.
Thursday’s data show that the UK remained the largest source of eurozone imports last year but on current trends China would knock the UK from its top position in 2008 or 2009, according to Julian Callow, economist at Barclays Capital.
The fastest growth in Chinese exports to Europe had been in mechanical and electrical machinery, Mr Callow added.
“We should not delude ourselves that this increase is all at the lower value-added part of the chain; China is rapidly moving up the ‘value curve’ in its exports,” he said.
Meanwhile, the Eurostat data showed imports into the EU from Russia grew faster last year than those from China, rising by 25 per cent to €136.9bn.
That reflected the importance of energy imports. But Russia has also become an increasingly important export market for European companies, especially German groups.
EU exports to Russia rose 27 per cent last year to €71.9bn.