China's exports unexpectedly rise even as coronavirus batters global demand

May 07, 2020, 11.01 AM | Source: Reuters
China's exports unexpectedly rise even as coronavirus batters global demand

ILUSTRASI. China's exports rose 3,5% in April for the first time this year


Imports sank 14.2% from a year earlier, the biggest contraction since January 2016 and below market expectations of an 11.2% drop. They had fallen 0.9% the previous month.

The soft imports reading was due to weak domestic demand and declines in commodity prices. The shutdowns outside China also dealt a heavy supply shock to the country's importers.

China's trade surplus for the period stood at $45.34 billion, compared with an expected $6.35 billion surplus in the poll and a surplus of $19.93 billion in March.

Both official and private factory surveys for April showed sub-indexes for export orders scaled back sharply, suggesting stronger external headwinds even as some countries have eased lockdowns.

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With the coronavirus under control domestically, China's economy has begun to open up again as authorities loosen draconian restrictions including stay-at-home orders.

But many factories are grappling with slashed or cancelled overseas orders after reopening as global demand remains tepid. Many are faced with rising inventory and falling profits, and some have let workers go as part of cost-cutting efforts.

Shaking off optimism of an immediate recovery, many economists have slashed their trade outlook for the near future.

"We expect export growth to slump further to -30.0% in Q2 from -13.3% y-o-y in Q1 and real GDP growth to remain negative at -0.5% y-o-y in Q2," said analysts with Nomura in a research note prior to the data release

Editor: Anna Suci Perwitasari

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