Chinese exports last month surged, the first gain in nine months and the latest positive data out of the world’s second-biggest economy. However, analysts said yesterday’s headline figure masked ongoing weakness in overseas demand.
Official figures showing a better-than-expected jump in shipments abroad come just days after another strong inflation reading and last week’s surprise jump in an index of factory activity.
They also come ahead of tomorrow’s release of first-quarter GDP data, which a poll by Agence France-Presse forecast would show expansion weakened further to 6.7 percent year-on-year, down marginally from 6.8 percent in the previous three months.
China’s General Administration of Customs said exports increased 11.5 percent year-on-year to US$160.8 billion, beating a 10 percent rise economists predicted in a Bloomberg survey and snapping an eight-month streak of declines caused by waning global demand. Exports plunged more than 25 percent in February.
However, imports fell for the 17th consecutive month, albeit at a slower pace, dropping 7.6 percent year-on-year to US$131 billion, the administration said.
Analysts said that the latest figures were helped by having a low basis of comparison, after exports plunged 15 percent year-on-year in March last year.
Zhao Yang (趙揚) of Nomura said in a note that shipments rose mainly because of the “low base and calendar effect,” due to seasonal distortions around the Lunar New Year holiday, adding that “external demand has not improved as much as the number might suggest.”
However, the pace of import declines reduced, “possibly driven by faster investment and government spending,” Zhao said.
A pickup in electronic supply chains as new mobile phones were launched last month might have contributed to export strength, ANZ Research said in a note, adding that import data indicate “stabilization” of commodity prices.
The trade surplus leaped to US$29.9 billion last month, nearly 10 times the US dollar figure for the same month last year.
The administration said in a statement that while figures for the first quarter showed a yearly decline, seasonally adjusted monthly data were recovering.
“The import volume of major bulk commodities, such as iron ore, crude oil and copper, maintained growth, while the prices of major import commodities remained low,” it said.
During the first three months of the year, China’s trade with the EU, the US and ASEAN all declined.
“There remain obvious obstacles facing China’s foreign trade development,” the administration said.
It initially gave the figures in yuan terms, which showed an 18.7 percent rise in exports, with imports slipping 1.7 percent.
Administration spokesman Huang Songping (黃頒平) attributed last month’s export growth to a low comparison base as well as government policy support.
He said that free-trade agreements, improvement in the ailing manufacturing sector and a stable yuan exchange rate were additional positive factors.
“The world economy still faces many uncertainties,” he added.
Risk factors for world trade include major economies’ monetary policies, possible competitive currency devaluations, geopolitical conflicts and rising protectionism, he said.
“The trade situation remains severe and complicated, and the downward pressures are still big, but positive factors that will promote trade are accumulating,” he said, adding that he expects Chinese trade to “stabilize and improve” this year.
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