China’s exports contracted sharply in December as global demand slowed, while imports also fell again as rising coronavirus infections and a sharply slumped real estate sector hit domestic demand, highlighting risks to the Asian giant’s economic recovery this year.
Exports were one of the few bright spots in the world’s second-largest economy during the pandemic, but they have declined rapidly since late 2022; Consumers abroad slashed spending on the back of central banks raising interest rates aggressively to rein in inflation.
This weakness is expected to continue into the new year as the global economy teeters on the brink of recession, but China’s imports are expected to slowly recover in the coming months after the government’s surprise move to lift strict anti-coronavirus measures in December paved the way for reopening. economy and unleash demand.
“Export prospects remain weak given a combination of slowing global growth and consumers’ continued shift from goods to services,” said Lloyd Chan, chief economist at Oxford Economics.
Customs data showed that exports shrank 9.9 percent year-on-year in December, extending losses after declining 8.7 percent in November, slightly exceeding expectations for a 10 percent drop, customs data showed on Friday. This is the largest decline since February 2020.
Imports fell 7.5 percent last month, compared with a decline of 10.6 percent in November, better than expectations for a 9.8 percent decline.
Despite the sharp decline in shipments in the past few months, total exports rose seven percent in 2022 thanks to China’s strong trade with Southeast Asian countries as well as the export boom of new energy vehicles. However, the increase was a far cry from the 29.6 percent recorded in 2021.
Imports rose just 1.1 percent last year, down sharply from 30 percent in 2021.
(Reuters)
