Michelle ThompsonFor the fourth consecutive month, China’s exports have fallen, highlighting the challenges faced by the “world’s factory” due to sluggish demand both domestically and internationally.
Official figures reveal that in August, exports in China declined by 8.8% compared to the same month the previous year, while imports decreased by 7.3%. It’s worth noting that these declines, while significant, were not as severe as anticipated and marked an improvement compared to the previous month’s data.
China is currently grappling with several post-pandemic challenges, including a property market crisis and subdued consumer spending. The country is also contending with reduced global demand for Chinese-manufactured goods, stemming from the effects of the COVID-19 pandemic and the ongoing trade tensions with the United States. These factors are significantly impacting a crucial source of economic growth for China.
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On Wednesday, a recent report from the US Census Bureau revealed that China’s portion of US goods imports reached its lowest point since 2006 by the end of July.
During this period, the share of imported goods from China stood at 14.6%, a notable drop from its peak of 21.8% in the year ending March 2018, before then-President Donald Trump escalated the US-China trade dispute.
Simultaneously, China is grappling with a deepening crisis in its real estate market, with some of its largest developers facing financial difficulties.
Beijing, however, has refrained from launching a substantial stimulus package to boost its economy. Instead, it has introduced various measures in recent months aimed at supporting individuals and businesses.
These measures include interest rate cuts by the country’s central bank and plans to permit a dozen major cities to reduce minimum homebuyer deposits. Lenders have also been encouraged to lower rates on existing mortgages.
Additional initiatives have been announced, such as increasing personal income tax allowances for children’s education and reducing the duty on share trading.
Leading up to the release of these trade statistics, the Chinese state-run newspaper, The Global Times, published a story on its English-language website that criticized negative comments by Western politicians and media regarding the Chinese economy.
The article stated, “The reality is that the Chinese economy is on a path of recovery, displaying increasingly robust innovation and green development momentum, although it faces certain difficulties and challenges due to the global economic slowdown.”
