Both Export and Import Growth Rates Fall Short of Expectations
Skepticism Grows Despite Stimulus Measures
Chinese Authorities Say "Fundamentals Are Solid, Market Conditions Favorable"
China's export and import performance in September this year fell short of market expectations. Despite the recent series of stimulus measures, skepticism is growing that the goal of 5% growth will be difficult to achieve.
China's September Trade Performance Falls Short of Expectations
According to the General Administration of Customs of China on the 14th, China's export value last month was $337.11 billion (approximately 412.1 trillion KRW). This represents a 2.4% increase compared to the same period last year but falls significantly short of Reuters' market forecast of 6.0% and the previous month's export growth rate of 8.7%.
Imports also missed expectations. September imports amounted to $222 billion, marking only a 0.3% increase year-on-year. Reuters' market forecast was a 0.9% increase, and the previous month's growth rate was 0.5%.
Thus, China's total trade volume last month was $525.71 billion, up 1.5% year-on-year. The trade surplus was $81.71 billion.
Exports measured in Chinese yuan increased by 1.6% year-on-year, while imports decreased by 0.5%. The overall trade volume grew by 0.7%.
On a US dollar basis, cumulative exports and imports for the third quarter of this year increased by 4.3% and 2.2%, respectively, compared to the same period last year. The total trade volume grew by 3.4% during the same period.
By region, the country with the largest export growth in dollar terms was Vietnam (+19.0%), followed by Malaysia (+12.9%) and the ASEAN (Association of Southeast Asian Nations) region, which increased by 10.2%. The Philippines, which has been in conflict over South China Sea territorial claims, saw exports and imports decrease by 2.0% and 1.1%, respectively.
Exports to the European Union (EU) increased by 0.9%, but imports decreased by 3.9%. Among EU member countries, exports to the Netherlands fell by 10.9%, while imports increased by 16.0%, and imports from Germany decreased by 11.6%. Exports and imports to and from the United States increased by 2.8% and 0.7%, respectively.
Exports to South Korea decreased by 3.2%, whereas South Korea's exports to China increased by 11.9%. Japan's exports and imports both declined by 5.7% and 4.2%, respectively. Exports and imports to Taiwan increased by 10.6% and 8.5%, respectively. Trade with Russia saw exports and imports rise by 2.4% and 1.7%, respectively, although the growth rate slowed compared to last year.
By product category, exports of automobiles (26.7%), ships (24.6%), home appliances (21.8%), and steel products (21.2%) showed notable growth. Rare earth exports also increased by 6.4%.
Growing Skepticism Over 5% Growth... Focus on Stimulus Effectiveness
As China's trade performance fell short of expectations, voices are emerging that the government's goal of 5% growth may become uncertain. The economy is struggling to gain momentum amid ongoing trade frictions with the West, including the United States, and a cooling real estate market. Due to a decline in global demand, China's export growth rate in September hit its lowest point in five months. Bloomberg News analyzed the September export performance, stating, "Even exports, which had been driving China's economic growth this year, have faltered."
Attention is focused on how effective the recently announced stimulus measures will be. Earlier, China's central bank, the People's Bank of China, on the 24th of last month?just before the National Day holiday (October 1?7)?cut the reserve requirement ratio (RRR) by 0.5 percentage points, supplied 1 trillion yuan (approximately 190 trillion KRW) in long-term liquidity, lowered policy and real estate loan interest rates, and injected funds to stabilize the stock market as part of a monetary policy package.
Subsequently, on the 8th, the National Development and Reform Commission, the macroeconomic authority, announced policies including early allocation of budgets for strategic industries and infrastructure investment. The day before, Lan Foan, Minister of Finance, held a press conference announcing plans to significantly increase government bond issuance to stimulate the economy.
At a press conference on the same day, Wang Lingjun, Deputy Director of the General Administration of Customs, stated, "Foreign trade in the first to third quarters of this year was generally stable," adding, "Despite challenges such as global trade protectionism, weakening growth drivers in major markets, and excessive debt burdens, the fundamental structure of China's economy remains solid, and market conditions are favorable."
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