BEIJING: China’s exports fell 7.4 per cent in August from a year earlier and had been forecast to decline by around the same amount in September. Beijing is trying to transform the country’s economic model to a more sustainable one where consumers replace exports and state-led investment as the key driver of growth.
The moderation in the contraction of exports is likely due to mild improvement in external demand, Zhao said. The country’s trade numbers for September are a tad better than expected, but they nevertheless show that growth momentum remains to the downside.
Chinese stocks ended little changed after the mixed trade report, with the Shanghai Composite Index finishing 0.2 per cent higher at 3,293.23 in range-bound trade. China’s crude oil imports rose by 5.1 per cent to a seasonal record high of 28 million tonnes, much of which can be put down to China’s efforts to expand its domestic refining industry.
Highlighting persistent weakness in demand at home and overseas, China’s combined exports and imports fell 8.1 percent in the first nine months of the year from the same period in 2014, well below the full-year official target of 6 percent growth. CHINA’S exports in September improved from August but remained in negative territory, as imports continued to head south, suggesting sluggish domestic demand and increased economic uncertainty.
The import slide reflects this year’s plunge in commodity prices and tepid domestic demand, as China shifts away from low-end manufacturing and debt-fuelled investment. Figures from the administration showed that the total foreign trade volume during the first three quarters declined by 6.2 percent, 8.1 percent and 9.2 percent, respectively.
“Despite stronger-than-expected exports, China’s external demand was weak in the third quarter”, said Liu Ligang, chief China economist at Australia & New Zealand Banking Group. Evans-Pritchard also said that import data had become unreliable given massive swings in prices due to the commodity downturns, and a divergence between prices and trading volumes.
Following the trade data released today, China’s national bureau of statistics will deliver CPI and PPI figures tomorrow along with monetary growth and bank lending figures later in the week. ANZ forecast third-quarter GDP growth at 6.4 per cent, down from the second quarter’s 7 per cent.
