Sunday 24 / November / 2024
Beijing: The value of China's exports to the world witnessed a drop of 8.8 per cent in August from a year earlier, The New York Times reported citing the Chinese government. The decrease in the value of China's exports to the world marked the fourth consecutive month of sliding overseas sales.
At the same time, China's imports reduced by 7.3 per cent in August from a year earlier, according to China's General Administration of Customs. China's economy is currently under the microscope as its growth since the spring has witnessed a dip and home prices have impacted, affecting consumer and investor confidence, The New York Times reported.
The new statistics showcased continued weak demand in China and abroad. China's "zero-COVID" policy during the pandemic, particularly the weekslong lockdowns in Shanghai, Shenzhen, Guangzhou, and other big industrial centers and ports, resulted in many shipping delays and the departure of many expatriate managers for multinationals.
As the pandemic concerns are now fading, households around the world, including in China, have shifted their spending patterns towards travel, restaurant meals and other services. Many had stocked up on manufactured goods during the pandemic. These statistics have showcased in the August data.
Exports of computers reduced by 18.2 per cent over August 2022. Exports of medical and surgical instruments which had boomed during the pandemic reduced by 7.1 per cent in August 2023, The New York Times reported.
Meanwhile, the overseas sales of household appliances like refrigerators and washing machines witnessed a rise of 11.4 per cent in August 2023. Imports of agricultural products in China reduced by 7.9 per cent from a year ago despite Beijing being heavily dependent on food from abroad.
China depends heavily on running very large trade surpluses each month as a way to create tens of millions of jobs. It has become particularly important for China in 2023 as youth unemployment has witnessed an increase. Exports have become even more important in the past few years as China is experiencing a sharp slowdown in the housing market.
The slowdown in the housing market comes after years of rampant speculation that resulted in a tenfold or more increase in the prices of apartments in many cities in China, according to The New York Times report. The data released on Thursday indicates that the overall demand for China's goods might have started to bottom out.
Louise Loo, an economist in the Singapore office of Oxford Economics, a consulting firm, said, "Less bad exports and imports add to our conviction that July was likely the darkest hour for economic activity in China," The New York Times reported.
Meanwhile, China’s economic slowdown has alarmed international leaders and investors, CNN reported on August 23. Hong Kong’s Hang Seng (HSI) Index slid into a bear market on Friday, having fallen more than 20 per cent from its recent peak in January.
The Chinese yuan, last week, fell to its lowest level in 16 years, prompting the central bank to make its biggest defence of the currency on record by setting a much higher rate to the dollar than the estimated market value.
Consumer prices are witnessing a fall, a real estate crisis is deepening and exports are in a slump. Unemployment among youth has gotten so bad that the Chinese government has stopped releasing the data, according to CNN. A major homebuilder and a prominent investment company in China have missed payments to their investors in recent weeks, indicating fears that the ongoing situation of the housing market could result in posing risks to financial stability.
