aziqbal
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China Trade Delivers Beijing Bad News
May 21, 2023,01:08pm EDT
Beijing's Forbidden City. (Photo by Noel Celis / AFP) (Photo by NOEL CELIS/AFP via Getty Images)
AFP VIA GETTY IMAGES
Recently this column looked behind China’s strong first quarter growth report and saw evidence of considerable economic weakness. Now import-export news for April, confirms the skepticism about that seeming strength.
April data on Chinese imports of goods and services shows them some 7.9 percent below year ago levels. Imports from South Korea, considered a bell weather of future activity, fell a whopping 26.5 percent. Exports grew, something of a surprise given how weak the American and European markets are, but at 8.5 percent above year-ago levels, they still exhibited a marked deceleration from March’s 14.8 percent advance.
Weak imports tell a two-part story about China’s immediate economic troubles. The first tells of the woes of the Chinese consumer. Though China has been characterized as the “workshop of the world,” a large portion of its consumer goods nonetheless flow in from abroad. With that flow clearly in decline, it looks increasingly as though the so-called “revenge spending” among consumers that had so lifted the first quarter’s GDP figure is neither as broad-based nor as durable as enthusiasts have claimed. It was apparent even a month ago that this spending surge concentrated mostly on luxury goods, especially high-end consumer services. These import figures confirm that such lavish spending has failed to extend to the vast majority of lower- and middle-income Chinese.
China Trade Delivers Beijing Bad News
April data on Chinese imports of goods and services was some 7.9 percent below year ago levels, while export growth has decelerated sharply.
www.forbes.com
