China has returned to a US$5.35bn export-led trade surplus, heralding the prospect that a rebound in the global economy is lifting overseas orders just in time to compensate for a slowdown in domestic demand.

The return to surplus from February's US$31.5bn deficit confounded expectations that trade would remain US$1.3 billion in the red, with a solid 10.4% year-on-year bounce in sales to the US helping exports grow faster than expected. Ironically America's uptick could accelerate China's resurgence relative to the US.

Is it incredible to believe that, in so doing, America's debt is increasing, alongside its dependency on Chinese credit? According to CardHub.com's Q2 2011 Credit Card Debt Study, US consumers accumulated $18.4 billion in credit card debt in the second quarter of 2011. That is a 66% rise on the same quarter a year before and 368% more than in the second quarter of 2009.

€There is no doubt in my mind that a lot of consumers are reverting back to pre-recession habits and that this is why we are witnessing such a dramatic increase in credit card debt (net of charge-offs). Anyone whose income was tied to the housing boom €" either directly or indirectly €" should realize that those years aren't coming back unless we find ourselves in another bubble,€ warned Odysseas Papadimitriou, CEO of CardHub.com.

Imports undershot expectations, growing 5.3% on the year in March. This is consistent with other data suggesting poor domestic demand in the first quarter of the year €" but the trade numbers overall reinforced the view that China's trade-sensitive economy is set for a soft landing in 2012.

Trade to Europe continues to be poor, although trade to America is up. Trade was a drag on growth in 2011 as China's economy turned in its slowest rate of expansion since 2009, at 9.2%, with each quarter's growth in 2011 successively weaker than the previous three months. The economy is predicted to grow by 7.5% this year, although Nomura Holdings raised their 2012 growth forecast to 8.2% and Deutsche Bank raised theirs to 8.6%.

There are still concerns. Import growth of 5.35% in March compared with expectations of 9.0% and February's 39.6% growth, while export growth of 8.9% compared with a consensus call for 7.2%.

For the first quarter, the value of exports was US$430.0bn, while imports were US$429.35bn €" bringing the trade account into the balance targeted by the government as it re-orients away from foreign to domestic demand.

China is expected to record a trade surplus for 2012, but smaller than 2011. China's surplus narrowed for a third straight year in 2011 to US$155bn, from US$183bn in 2010, US$196bn in 2009 and US$296bn in 2008. The trade surplus as a share of GDP dropped to 2% in 2011 from 3.1% in 2010.

China faces threats over inflation and wages, as it becomes cheaper to make goods in lower income economies like Vietnam, India, Cambodia and Bangladesh. Exports have been vital for China's three decades of economic development, with economists calculating that 10,500 jobs are created for every US$100 million of goods exported.

That said as China gets richer, the country which graduates more scientists and engineers than any other country (and files the most patents), is beginning to do more than merely put together designs sent from the West. Companies like computer giant Lenovo (the world's third largest personal computer manufacturer) are pointing the way for greater innovation.

The People's Bank of China has cut the proportion of deposits banks must keep as reserves by 100 basis points in two moves since 2011 to keep credit growing in the face of a recent slowdown of foreign capital inflows, which had underpinned money supply growth for much of the last decade.

It should be remembered that even if China's annual GDP growth slowed to 5% and America's stayed between 2.5-3% (and inflation went up to 4% in China and was around 1.5% in the US), China would still become the world's largest economy in real terms (GDP nominal) in 2021, rather than the predicted 2018. It is still due to overtake the United States in relative terms (purchasing power parity) by 2016.