BEIJING, April 13 (BNA): China’s imports unexpectedly fell in March as restrictions imposed on the spread of the Corona virus in large parts of the country hampered shipping access and weakened domestic demand, while export growth slowed, leading analysts to expect a deterioration in trade per second. a fourth.
Weak trade numbers are likely to boost expectations of more political support from Beijing, as a government adviser on Wednesday called for lower bank reserve requirements and interest rates to boost the faltering economy, Reuters reports.
On Wednesday, customs data showed that incoming shipments fell 0.1 percent from their level a year ago in March, marking the first decline since August 2020. That compares with a 15.5% increase in the first two months of the year and an 8% increase expected by analysts in a Reuters poll.
The decline was widespread. China’s crude oil imports fell 14% in March and gas import volumes were the lowest since October 2020. Copper purchases fell 8.8%, as the coronavirus outbreak hit manufacturing activity and industrial demand for some raw materials continued to be weak.
Exports – currently the main driver of the economy – rose 14.7% in March, topping analysts’ expectations for a 13% rise, although slowing from a gain of 16.3% in the January-February period.
“While the disruptions from the recent COVID-19 outbreak are partly to blame, demand-side shifts have played a larger role,” said Julian Evans-Pritchard, chief China economist at Capital Economics.
He said that imports are likely to remain weak while exports will decline further in the coming quarters.
Analysts expect business conditions to worsen in April, due to slowing customs clearance and with the impact of the ongoing Shanghai lockdown.
China’s efforts to curb the largest outbreak of COVID-19 in two years have restricted activity in several cities including Shanghai and forced companies from Apple supplier Foxconn to automakers Toyota and Volkswagen to suspend some operations.
This will likely lead to lower demand for imported raw materials for Chinese factories, according to Zheng Husheng, director of the Yingda Securities Research Institute.
“The pressure on the global economy is likely to lead to lower commodity prices in the medium term, which will hurt China’s exports, both in terms of volume and value, in the second half,” Cheng said.
China’s strong trade performance seen over the past two years is set to slow this year as other countries emerge from COVID lockdowns, soaring energy prices and global logistics disruptions.
Factory activity fell in March as the decline in export orders accelerated, recent manufacturing surveys showed, as companies reported customers canceling or suspending orders due to doubts about the Ukraine war.
Qi Yong, general manager of consumer electronics distributor Shenzhen Muchen Technology Co, told Reuters that orders from European customers fell 20% in March from last year, although outbound shipments to North America remained active.
This is due to the “weak purchasing power caused by the war and the risks of an economic slowdown in European economies,” Chi said, adding that “exporters exposed to conglomeration may continue to feel the squeeze.”
China posted a trade surplus of $47.38 billion in March, more than double the forecast of $22.4 billion, thanks to an unexpected drop in imports. The country recorded a surplus of $115.95 billion in the January-February period.