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China export news

BEIJING - CHINESE exports fell more steeply than expected in April, overshadowing strength in capital spending and casting fresh doubt on how solid the prospects for recovery are in the world's third-largest economy.

Investment boost Saul Eslake, chief economist at ANZ Bank in Melbourne, said he would not interpret April's trade data as suggesting that hopes for a revival in China have suffered a material setback. 'The recovery is being driven primarily by domestic demand and policy measures that have driven domestic demand. It would be hard for China to recover by exports alone, in advance of a significant turn-up in the markets of its major trading partners,' Mr Eslake said. ... more

Exports were down 22.6 per cent last month from a year earlier, the government said on Tuesday. That was steeper than March's 17.1 per cent decline and greater than the 18 per cent drop that economists had expected.

After adjusting for the numbers of working days, the customs office said China exported 6.9 percent more in April than in March. But most economists said the figures were disappointing.

'The future of the world economy remains uncertain, and it's really hard to be optimistic about China's trade prospects,' said Qi Jingmei, an economist with the State Information Centre, a government think-tank in Beijing.

Ms Qi also pointed to a 23 per cent year-on-year drop in imports in April as evidence that private companies remained reluctant to invest. Economists had expected a 22 per cent fall in imports after a 25.1 per cent drop in March.

China had a trade surplus of US$13.14 billion (S$19.2 billion) in April, calculated from export and import totals issued by the customs bureau. That was less than March's reading of US$18.56 billion and the median forecast of US$17.4 billion in a Reuters poll of economists.

'Exports are likely to drop further in the near term as economic indicators in the United States and Europe, such as industrial output and retail sales, are not looking up,' said Wang Xiaohui, an analyst at Sinolink Securities in Shanghai.

Recent figures from some of China's trading partners have indicated that the worst of a brutal contraction in export and import flows triggered by the global financial crisis may be over.

Jean-Claude Trichet, president of the European Central Bank, further fuelled optimism on Monday by suggesting some economies have already turned the corner.

'The global economy is around the inflection point with some being beyond the inflection point,' Mr Trichet told a news conference in Basel, Switzerland, after chairing regular talks on the global economy among leading central bankers. -- REUTERS