| 9 December 2023, Saturday |

China’s exports seen rising in April but at slower pace, outlook challenging

As a result of unmet orders following the COVID interruptions last year, China’s exports were anticipated to have increased once more in April, albeit at a slower rate than a month earlier, according to a Reuters poll. However, the forecast is becoming less optimistic due to the weakening of global development.

The consensus estimate of 27 analysts in the poll, which was completed on Monday, predicted that the world’s second-largest economy’s exports will increase by 8.0% last month over the same period last year, following an unexpected increase of 14.8% in March.

Imports are still expected to paint a less favourable picture of the overall economy, with economists predicting no growth, similar to April, 2022, after falling by 1.4% year-on-year in March.

The trade data will be released on Tuesday.

With many of China’s major trade partners on the brink of recession, analysts remain wary about the outlook, noting that the stunning improvement in March partly reflects suppliers catching up with unfulfilled orders from last year’s COVID disruptions.

The cautious stance was backed by the recent official manufacturing purchasing managers’ index for April showing new export orders contracting sharply and underlining the challenge facing Chinese policymakers and businesses hoping for a robust post-COVID economic recovery.

“We believe March’s 14.8% year on year growth is unsustainable and monthly export growth may drop to low single-digit or even into negative territory again,” Ting Lu, chief China economist at Nomura, wrote in a note, citing a slowing global economy and rising geopolitical tensions.

South Korean exports to China, a leading indicator of China’s imports, were down 26.5% in April, continuing 10 consecutive months of decline.

China’s economy grew faster than expected in the first quarter thanks to robust services consumption, but factory output has lagged amid weak global growth. Property market weakness, slowing prices and surging bank savings are raising doubts about demand.

The government has set a modest GDP growth target of around 5% for this year, after badly missing the 2022 goal.

  • Reuters