After lockdown loosening
China’s exports are growing faster than expected
06/09/2022, 4:10 p.m
After China’s foreign trade initially suffered severely from the consequences of the imposed lockdowns, the country now seems to be recovering. The current export figures are a lot higher than expected. However, unstable supply chains and high international inflation rates continue to affect foreign trade.
Against the backdrop of a somewhat more stable pandemic situation, China’s foreign trade grew faster than expected in May. The exports of the second largest economy increased by 16.9 percent to 308.3 billion US dollars (287.2 billion euros) compared to the previous year, as announced by the Beijing customs administration. Imports also rose 4.1 percent to $229.5 billion, faster than analysts had expected.
The Chinese economy came under pressure in the first half of the year due to the strict measures to contain the corona virus. However, some restrictions have recently been relaxed because the number of infections has fallen. In Shanghai, the country’s most important economic hub, a two-month lockdown ended last week, which could give a boost to trade in the coming months.
Continued uncertainty among trading partners
Despite the recent easing, foreign business representatives continued to complain about major uncertainties. So it is hardly foreseeable when and where there will be the next lockdown in the country, which could have a negative impact on business and supply chains.
In a survey published by the German Chamber of Foreign Trade in mid-May, 73 percent of the participants stated that they operated in cities or regions where there were partial or complete curfews. Only about every fifth German company had a special permit to continue production despite restrictions. The conditions in China also made it increasingly difficult to keep personnel from Germany in the country.
China’s Vice Minister of Commerce Wang Shouwen warned of further uncertainties on Wednesday. “Potential threats” came from the fragile global economic situation, high international inflation and logistical bottlenecks within China. Also on Wednesday, Prime Minister Li Keqiang called for foreign trade to be strengthened. He urged improving the efficiency of ports and customs clearance. The stability of supply chains must also be guaranteed.