Exports and Imports Decline Less Than Expected
In the bustling economic landscape of Beijing, China reported another month of declining imports and exports, albeit with a silver lining that surpassed expectations.
In August, exports in U.S. dollar terms dipped by 8.8% compared to the previous year, a more favorable outcome than the 9.2% drop projected by a Reuters poll. Simultaneously, imports in U.S. dollar terms fell by 7.3% in August from a year ago, surpassing the 9% decline forecast by Reuters.
Notably, imports have recorded a continuous descent every month in 2023 compared to the previous year, while exports have faced year-on-year declines since April, reflecting a global reduction in demand for Chinese products.
Of particular interest, China’s exports to the U.S. saw a decrease of 9.5% in August from a year ago, signaling an improvement compared to the drastic drops of over 20% witnessed in the preceding two months. On the flip side, China’s imports from the U.S. registered a 7.9% decline in August from the previous year, showing an improvement from the double-digit decline observed in July, as revealed by data accessed through Wind Information.
It’s worth noting that the United States stands as China’s largest trading partner on a single-country basis, while the Association of Southeast Asian Nations (ASEAN) holds the distinction of being China’s largest trading partner on a regional scale.
In the same vein, China’s trade with Southeast Asia exhibited a decline, with exports to the region falling by 13.3%, and imports dropping by 6.1% in August from a year ago. However, these figures still represent an improvement from the previous month, July.
Hao Zhou, Chief Economist at Guotai Junan International, remarked, “In general, the figures still suggest the headwinds remain despite some marginal improvement.” Looking forward, Zhou emphasized that the trajectory of China’s trade growth will depend on factors like the property market, rising oil prices, and the relative strength of the Chinese yuan against the U.S. dollar.
China, being the world’s largest importer of crude oil, recorded a 14.7% increase in its crude oil imports by volume during the first eight months of the year compared to the previous year. This growth rate outpaced the 12.4% pace seen as of July, as per customs data.
However, China’s economic rebound from the pandemic has witnessed a slowdown in recent months, attributed to a sluggish property market and subdued consumer spending. Notwithstanding, the automobile sector remained a bright spot, with exports experiencing a 69% rise during the first eight months of the year compared to the same period in 2022, although this growth rate decelerated slightly from the 74.1% increase recorded in the initial seven months of the year.
