Econintersect: China’s imports were down by 0.4% (year-over-year) in May. The decline from a month earlier was more significant, at almost 4%, while May fell a whopping 18.3% below March’s record $1.83 billion. Exports were up just under 1% in May from the same month a year earlier, while China’s trade surplus increased to $20.45 billion, up 12.6% over the May 2012 level.
Exports were the fifth highest on record in May, but were down 2.3% from April and 8.3% from the all-time high in December 2012. The four higher import numbers were all recorded over the eight preceding months. Export gains year-over-year were the weakest in 10 months.
Bloomberg says that a significant factor in the decline in exports compared to recent months is the government crackdown on faked shipment invoices which had resulted in an apparent surge of exports to Hong Kong. From The New York Times:
Chinese customs data compiled by CEIC Data in Hong Kong showed that the mainland’s exports to Hong Kong were up only 7.7 percent in May from a year earlier. In April, they had been up 57.2 percent from the same month last year, and in March they had been up 92.9 percent.
There are concerns about the strength of the Chinese economy going forward. From Bloomberg:
“Growth remains unconvincing and the momentum seems to have lost pace in May,” said Louis Kuijs, chief China economist at Royal Bank of Scotland Group Plc in Hong Kong. “While we still do not worry too much about growth in 2013 ending up significantly lower than the government’s comfort zone, on balance this weekend’s data is likely to strengthen the calls for a more expansionary macroeconomic policy stance.”
Bloomberg cited a number of indicators of slower economic activity:
- Industrial production rose a less-than-forecast.
- Factory-gate prices (Producer Prices) fell for the 15th month in a row.
- Fixed asset investment growth is slightly lower.
- Bank lending is slowing.
- Overdue loans were up 46% in number in 2012.
A more positive note is retail sales growth of 12.9% (y-o-y) in May, which met expectations.
- China’s Export Growth Slows Amid Concern of Slowdown (Gerry Mullany and Keith Bradsher, The New York Times, 08 June 2013)
- China Export Growth Plummets Amid Fake-Shipment Crackdown (Xin Zhou and Paul Panckhurst, Bloomberg, 09 June 2013)
- China: Exports and Imports Increase in April but Data is Questioned (GEI News, 08 May 2013)