China’s exports tumbled for the fourth consecutive month in August amid weak external demand and ongoing global supply chain upheaval, posing more challenges to the world’s second-largest economy as it struggles to carve out a path to a post-pandemic rebound.
Exports fell by 8.8 per cent compared to a year earlier to US$284.9 billion last month, according to customs data released on Thursday.
Imports, meanwhile, fell by 7.3 per cent last month to US$216.5 billion, narrowing from a 12.4 per cent decline in July, and exceeding the expectations from Wind for a drop of 8.2 per cent.
China’s total trade surplus in August stood at US$68.4 billion, down from US$80.6 billion in July.
“The typhoon in mid-July likely disrupted port operations in July and the normalisation of that could add to trade growth in August,” said economists from Goldman Sachs.
Improved year-over-year growth of oil prices would have also helped import growth last month, they added.
Heron Lim, assistant director and economist at Moody’s Analytics, said exports are expected to continue their retreat as weakness across the broader global economy keeps new export orders soft.
“But as trade performance was already weakening from the second half of 2022, it will be slower,” he said.
The data showed that China’s exports to most of its major trading partners continued to shrink, although the declines narrowed from July.
Shipments to the Association of Southeast Asian Nations – China’s largest trade partner – fell by 13.25 per cent compared to a year earlier, marking the fourth consecutive monthly decline.
Exports to the European Union, meanwhile, declined by 19.58 per cent, year on year, while shipments to the United States dropped for the 13th consecutive month after falling by 9.53 per cent.
Zhou Hao, chief economist at Guotai Junan International, said while the August trade figures came in slightly better than expected, the overall momentum remains lukewarm.
“In general, the figures still suggest the headwinds remain despite some marginal improvement,” Zhou said.
“Looking ahead, whether China’s trade growth has already hit the bottom will hinge on several factors. The most important one is obviously the domestic demand where the recent property easing might provide some support in the short term.
“In the meantime, the rising oil prices suggest that the import growth in value terms might pick up somewhat in the foreseeable future.”