China’s exports recover after March slump; shipments up in Asian bloc, decline in US, Europe | 5 key points

China’s merchandise exports recovered in April after falling sharply in the preceding month of March, as per the data released by the country's customs department on May 9. The top destination of Chinese shipments was the Association of Southeast Asian Nations (ASEAN), whereas the amount of exports to the advanced economies of Europe and the United States declined.

Exports in April grew at a rate of 1.5% as against the year-ago period. This marked a significant recovery as against a decline of 7.5% recorded in March.

In a sign of improving domestic demand, the official data showed China’s imports rebounded with an 8.4% growth in April, as compared to a fall of 1.9% in the preceding month.

China trade data: Here are five key points

• The exports, growing at 1.5% in April, are in line with the analysts' expectations. However, the rate of imports, growing at 7.5%, has exceeded the estimate of 4.8% as shared in a Reuters poll of economists.

• The trade data numbers reinforce China’s dominance of the global merchandise trade, with the trade surplus rising to $72.35 billion in April from $58.55 billion in March.

• ASEAN remained the biggest export market for China. The 10-nation bloc of Asian countries accounted for 16.9% of the total Chinese shipments in the first four months of this calendar year, as per the official data.

• Exports to the United States, a top economic and geopolitical rival of China, declined by 1.6% in April as compared to the same month last year.

• Exports to the European Union (EU), a key strategic partner of the US, also declined by 3.3%. The data comes out at a time when Chinese President Xi Jinping is visiting Europe, marking his first visit to the continent in the last five years. One of the objectives behind the visit, say analysts, is to improve the trade ties with constituents of the EU.

China, reeling under a dampened pace of growth since the outbreak of Covid-19 pandemic in 2020, has set an ambitious target to expand its economy by 5% this year. A further uptick in exports and imports is essential to achieve the goal, analysts said.

A section of economists, however, feel that the momentum seen in April’s exports may not last long. The volume is likely to retreat in the coming months due to diminishing tailwinds from lower export prices and cooling consumer expenditure in developed economies, Zichun Huang of Capital Economics said in a note.