China economy: Quick View – Exports shrink in September amid patchy global demand
On October 12th China’s General Administration of Customs released trade data showing that merchandise exports fell in value by 0.3% year on year in September, while imports grew by 7.4%. The trade surplus was reported as US$15.2bn, compared with US$28.4bn in August.
The fall in exports in September signals that the support provided to the economy by the external sector in recent months has flagged. Stronger external demand had pushed year-on-year export growth to 5.1% and 7.2% in July and August respectively. Base effects probably played a role in causing exports to decline in September, as the year-earlier data are likely to have been inflated by overinvoicing practices that the authorities have since cracked down on. Yet, both Taiwan and South Korea also reported falls in the value of their exports in the month, suggesting that China’s figures may not be overly distorted. Global demand has clearly yet to return to sustained expansion.
A weakening in previously soaring export growth to Association of South-East Asian Nation (ASEAN) members, many of which have been affected by volatile capital flows in recent months, contributed heavily to the September results. Growth in exports to the US also eased in September, while shipments to the EU – which had returned to growth in July and August – declined. More positively, exports to Japan rose in September, for the first time in nine months.
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