Chinese trade falls again due to the weakening of world demand

FILE PHOTO: Containers are seen at the Yangshan deepwater port in Shanghai, China October 19, 2020. REUTERS/Aly Song

BEIJING, March 7 (Reuters) – Chinese exports in the January-February period fell again from a year earlier, customs data showed on Tuesday, while imports also fell again and at a faster pace, reflecting the slowdown in the global economy and weak domestic demand.

Chinese exports in the two months were 6.8% lower than a year earlier, a better result than a Reuters poll that expected exports to decline 9.4%. Imports fell 10.2%, far exceeding the survey estimate of a 5.5% drop.

In December, exports fell 9.9% annually due to cooling global demand, while imports fell 7.5%.

The customs agency publishes combined trade data for January and February to smooth out distortions caused by the change in the date of the Lunar New Year, which fell in January this year.

However, imports were expected to continue to gradually recover as consumer confidence returned following the lifting of COVID-19 restrictions in December. Chinese authorities have not failed to warn that exports could suffer as the risk of a global recession increases.

Premier Li Keqiang said on Sunday that the government had set an economic growth target of around 5% for 2023. Foreign trade is likely to drag down economic growth this year, analysts say.

Last year, the economy grew 3% more than in 2021, thus missing the official growth target of around 5.5%.

In a sign that the economic recovery is underway, manufacturing activity in China expanded in February at its fastest pace in more than a decade, data from the National Bureau of Statistics showed last week, with a rise in new export orders for the first time since April 2021.

However, readings for factory activity in other Asian economies in February were more downbeat, reinforcing the view that conditions abroad are sluggish.

Domestic consumption and services have led China’s recovery so far this year.

Commerce Minister Wang Wentao said on Thursday that “consumption has rebounded significantly since the beginning of the year.” production since March 2021.

However, at the same press conference, Wang also warned that the pressure on Chinese imports and exports will increase significantly this year, due to the risk of a global recession and weakening foreign demand.

(Reporting by Joe Cash and Ellen Zhang; Editing by Bradley Perrett, Spanish editing by José Muñoz)

---

Source

---