China exports rose unexpectedly for first time in 6 months in March

BEIJING

China’s exports rose in March for the first time in six months, customs data showed yesterday, as the world’s second-largest economy continued its recovery following the end of onerous coronavirus curbs late last year.

The 14.8 percent surge in overseas shipments marked the first since September and will provide a boost to hopes for a lasting rebound.

Beijing long maintained some of the world’s strictest COVID curbs, persisting with snap lockdowns and lengthy quarantines despite their increasingly dire economic consequences.

The government abruptly ditched the restrictions in December, and a wave of cases afflicted the operations of many businesses for several weeks.

The sharp uptick was a “positive surprise”, said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.

However, he added that the sharp rebound “may be partly due to a low base effect”, noting that COVID outbreaks in March last year forced many Chinese factories to shut down and restricted operations at the country’s ports.

“The other factor behind the strong export growth may be the inventory and order cycles for exporters,” Zhang said.

Imports in March contracted 1.4 percent, a more moderate pace than in January and February.   

China’s economy grew just three percent in 2022 -- one of its slowest rates in decades -- and the country has set a modest target of “around five percent” for this year. 

There is optimism that goal can be reached, with the International Monetary Fund (IMF) on April 11 maintaining its annual growth forecast for China at 5.2 percent.

“As COVID-19 waves subsided in January of this year, mobility normalised, and high-frequency economic indicators - such as retail sales and travel bookings - started picking up,” the IMF wrote in its World Economic Outlook report.

China’s year-on-year trade with the U.S. fell 17.4 percent, and dropped 10 percent with the European Union, yesterday’s figures showed.     

But there was a sharp 25.9 percent increase in trade with Russia as Moscow focuses on business with its giant neighbour after being hit with sanctions following its invasion of Ukraine.  

Top Chinese leaders have signalled a focus on recovery, with new Premier Li Qiang last month telling a major economic forum that the country was showing “strong momentum”.