Control of access to the tunnel leading to the Pudong district in confinement, March 28, 2022 in Shanghai (AFP / Hector RETAMAL)
At their lowest since 2020: imports from China experienced an unexpected decline in March, at a time when the containment of Shanghai is heavily penalizing activity and the war in Ukraine adds uncertainty.
The first country affected by Covid-19 but also the first to emerge from it, China had for the past two years been massively supplied abroad to support its recovery, mainly by buying raw materials and agricultural products there.
But the Asian giant has been facing its worst outbreak of the entire pandemic in recent weeks: millions of people have been hastily confined, especially in Shanghai, the economic capital.
Travel restrictions are straining supply chains in the city of 25 million people. The port metropolis is an important entry and exit point for goods in China.
As a result, China unveiled mixed trade figures for the month of March on Wednesday. Last month, imports fell 0.1% year on year, Customs said. This unexpected drop is a first since August 2020, when the Asian giant was gradually recovering from the first wave of the pandemic.
Analysts polled by the Bloomberg agency on the contrary anticipated in March an increase in imports over one year (+8.4%).
– The impact of confinements –
Cars for export at the port of Yantai in Shandong province on April 13, 2022 (AFP/STR)
As for exports from China, they experienced a slowdown: Chinese sales abroad certainly increased in March by 14.7% over one year. But this rate is lower than that of January and February combined, the only data then published (16.3%).
“The impact of certain factors at the international and national level has proved to be greater than expected,” Chinese Customs spokesman Li Kuiwen told reporters.
This drop in exports last month coincides with the moment when the Russian invasion of Ukraine, and the Western sanctions that followed, sent shock waves through the markets.
The trade figures for March “highlight” the impact of the confinements and restrictions linked to the epidemic on activity and consumer spending, underlines for AFP the analyst Rajiv Biswas, of the firm IHS Markit (S&P Global).
In addition to Shanghai, tens of millions of Chinese were confined last month, especially in the northeast of the country, the cradle of the automotive industry, as well as in the technological metropolis of Shenzhen (south).
“The temporary closures of certain factories […] have also penalized the demand for imported raw materials” from abroad, believes Mr. Biswas.
– Uncertainties –
For the next two months, imports “will remain weak” as new orders fell in March due to the lockdowns, warns economist Zhiwei Zhang of Pinpoint Asset Management. In addition, transport “takes time” because of the restrictions, he notes.
At a factory producing medical infusion sets in Huaian, Anhui province, on April 11, 2022 (AFP/STR)
The decline in exports is for its part to be put on the account of a gradual return to normal on the epidemic front in the West, estimates analyst Julian Evans-Pritchard, of the firm Capital Economics.
Chinese exports have largely benefited for two years from the needs of the rest of the world for protective products against Covid, such as masks, or equipment for teleworking. But this demand is declining.
At a time when the war in Ukraine and the resulting sanctions are creating uncertainties on world trade, China saw its trade with Russia jump 12.2% year on year in the first quarter, according to Chinese Customs.
China, which did not condemn the Russian invasion, has been Moscow’s leading trading partner for 12 years. The Russian neighbor is a major supplier of gas, oil and agricultural products for Beijing.
© 2022 AFP
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