China’s Jan-Feb commerce probably shrank again

A Reuters poll revealed on Monday that China likely once more exported and imported less in January and February than a year earlier, supporting authorities’ concerns that a weakening global economy might hinder domestic development.

Exports are predicted to have decreased by 9.4% from a year earlier in January-February, which is only marginally better than the 9.9% annual decline seen in December, which was the worst result since February 2020.

On Tuesday, actual trading data will be made available.

Wang Wentao, the minister of commerce, issued a warning on Friday, predicting that the country’s imports and exports would face considerable downward pressure this year as the likelihood of a worldwide recession and the resulting weakening of external demand increased.

China’s economy, the second biggest in the world, expanded at one of its weakest rates in decades in 2022, thus the country has set a target for economic growth this year of about 5%. Just 3% more GDP was produced in 2022 than in 2021.

The median estimate of 29 analysts in the survey suggested that imports were likely 5.5% lower in January and February than they were a year earlier, which was an improvement above the 7.5% annual decline observed in December.

Due to the lunar new year holiday falling in February rather than January, China releases combined data for numerous statistics.

Premier Li Keqiang emphasised the need for economic growth during the beginning of the annual session of the National People’s Congress, which is anticipated to last through March 13. Premier Li Keqiang stressed the need for economic stability and expanding consumption.

As of this point in the year, domestic consumption and services have driven China’s recovery.

At a news conference held on Monday in Beijing, the nation’s official planner expressed confidence that China could meet its growth goal for 2023 if consumption increased. It concurred with the Commerce Ministry’s worries that exports faced significant obstacles from the outside world.

Manufacturing activity in China in February expanded at its fastest pace in more than a decade, data from the National Bureau of Statistics showed on March 1, with new export orders rising for the first time since April 2021.

Factory activity readings from other Asian economies for February were more downbeat, however, reinforcing the view that conditions abroad were more sluggish.