China’s exports falling indicating weak global demand
2023.03.07 03:59
China’s exports falling indicating weak global demand
By Ray Johnson
Budrigannews.com – China’s government is concerned that domestic concerns will be exacerbated by a global slowdown, as evidenced by a decline in exports from January to February.
The country imports parts and materials from abroad for many of its exports, so Tuesday’s government data showed that imports fell as well. This may also be a reflection of weak foreign demand.
After a 9.9% annual decline in December, exports in the two months were 6.8% lower than they had been a year earlier. However, the outcome was higher than the 9.4% decline that was the typical expectation in a Reuters poll.
Imports decreased by 10.2%, exceeding the poll’s estimate of 5.5%. Imports in December were 7.5% lower than a year earlier.
Iris Pang, ING’s chief economist for Greater China, stated, “Given the high inflation in the U.S. and Europe, demand from there should keep weakening, which also dampens the processing demand in China.”
Due to the possibility of a global recession and weakening external demand, China’s Commerce Minister Wang Wentao warned on Thursday that downward pressure on the country’s imports and exports would rise significantly this year.
After the world’s second-largest economy grew at one of its slowest rates in decades in 2022, China has set a goal for GDP growth of about 5% this year. GDP growth over 2021 was only 3%.
To lessen the effects of the Lunar New Year, which fell in January this year, the customs agency publishes combined January and February trade data.
Following the December removal of COVID-19 restrictions, economists anticipate that imports will gradually recover as consumer confidence returns. However, they caution that the slowdown in other countries may also limit the volume of goods entering China.
In comparison to the same time last year, China imported 9.4% less of in January and February. However, as domestic demand improved, imports of coal and soybeans increased.
According to data from the National Bureau of Statistics from last week, manufacturing activity expanded at its fastest rate in more than a decade in February, giving economists reason for optimism.
However, February factory activity readings from other Asian economies were more negative, confirming perceptions that conditions abroad were more sluggish.
