China’s foreign trade has surprisingly lost momentum. In August, exports calculated in US dollars only increased by 7.1 percent compared to the same period last year, as reported by Chinese customs on Wednesday in Beijing. Experts had expected double-digit growth after exports rose by 18 percent in July.
The reasons given were falling global demand due to rising inflation and energy prices. The disruptions to production in China due to lockdowns as a result of the zero-Covid strategy and energy bottlenecks due to the heat were also mentioned.
The imports of the second largest economy also developed worse than forecast with a minimal increase of only 0.3 percent. In July, an increase of 2.3 percent was recorded. According to experts, the background to this is the bad mood among Chinese consumers and the crisis in the real estate market in China. The trade surplus was also below expectations at $79 billion.
Despite the generally weak import development for China, there was good news for German exporters: despite everything, German exports to China were able to record a rare increase of 4.9 percent. German imports from China rose by 9.6 percent, as reported by customs.
“The sharper-than-expected slowdown in China’s export growth is another sign the recovery is losing momentum – and needs more policy support,” said David Qu, chief economist at Bloomberg finance agency. “We expect trade to remain under pressure for the remainder of the year.”
China’s trade with Russia, against which international economic sanctions had been imposed for its invasion of Ukraine, continued to develop strongly. China, which politically stands behind Russian President Vladimir Putin, imported 59.3 percent more from Russia – mainly energy. Conversely, Chinese exporters delivered 26.5 percent more goods to the neighboring country.
The European Union was also able to increase its exports to China by 3.1 percent. Conversely, China exported 11.1 percent more to the EU. In trade with the US, on the other hand, both China’s imports and exports fell. Chinese exports fell by 3.8 percent, while imports from the US fell by as much as 7.4 percent.
“After two years of exceptional surge, China’s export growth is returning to normal levels,” said Lu Ting, chief economist at Nomura Holdings, according to Bloomberg. The poor import development is due to weak domestic demand. According to these data, the volume of imports of oil, iron ore, coal, natural gas and soybeans declined in the first eight months of the year.
In any case, the Chinese economy is under pressure. In the second quarter, growth in China had only reached 0.4 percent. The government had actually set a target of 5.5 percent for this year. But the International Monetary Fund (IMF) only expects 3.3 percent. (dpa)