AP

China’s trade rebounds in May as anti-virus curbs ease

Jun 8, 2022, 9:05 PM | Updated: Jun 9, 2022, 11:47 am

BEIJING (AP) — China’s trade growth rebounded in May after anti-virus restrictions that shut down Shanghai and other industrial centers began to ease.

Exports surged 16.9% over a year earlier to $308.3 billion, up from April’s 3.7% growth, a customs agency statement said Thursday. Imports rose gained 4.1% to $229.5 billion, accelerating from the previous month’s 0.7%.

China’s trade has been dampened by weak export demand and curbs imposed to fight outbreaks in Shanghai, site of the world’s busiest port, and other cities. Consumer demand was crushed by rules that confined millions of families to their homes.

Forecasters have cut estimates for China’s economic growth to as low as 2% this year, well below the ruling Communist Party’s target of 5.5%. Some expect activity to shrink in the quarter ending in June before a gradual recovery begins.

Most factories, shops and other businesses in Shanghai, Beijing and other cities have been allowed to reopen but are expected to need weeks or months to return to normal activity.

“Exports showed considerable resilience in May despite the impact of the protracted lockdown in Shanghai,” said Rajiv Biswas of S&P Global Market Intelligence in a report.

China’s politically sensitive global trade surplus widened by 82.3% over a year earlier to $78.8 billion. That was among the highest monthly trade gaps but below December’s record $94.4 billion.

Exports to the United States rose 15% over a year ago to $51.9 billion despite lingering U.S. tariff hikes on Chinese imports in a dispute over Beijing’s technology ambitions. Imports of American goods rose 21.2% to $15.8 billion.

China’s trade surplus with the United State widened by 13.5% to $36.1 billion.

Import figures got a boost from higher global prices for oil and other commodities while the volume of foreign goods bought grew less strongly.

The export rebound is likely to be temporary due to “growing headwinds” as high inflation and rising interest rates weigh on consumer purchasing power, said Sheana Yue of Capital Economics in a report.

“Outbound shipments will soften,” Yue said. “Imports are set to remain weak.”

Exports to the 27-nation European Union rose 20.3% to $48 billion, while imports of European goods jumped 95.7% to $24.8 billion. China’s trade surplus with the EU widened by 83.2% to $23.2 billion.

Imports from Russia, mostly oil and gas, jumped 79.5% over a year ago to $10.3 billion.

China’s growing purchases of Russian energy are irritating Washington and its allies at a time when they are enforcing trade and financial sanctions to punish President Vladimir Putin’s government for its Feb. 24 invasion of Ukraine.

Beijing declared ahead of the attack that it had a “no limits” friendship with Moscow. It criticizes the sanctions but has avoided helping Putin for fear of losing access to Western markets and the global banking system.

China bought 20% of last year’s Russian crude exports, according to the International Energy Agency.

China’s “zero-COVID” strategy that confined Shanghai’s 25 million people to their homes starting in late March helped to keep case numbers low but disrupted manufacturing and trade.

The Port of Shanghai says the number of cargo containers handled each day returned to 95% of normal by late May. However, a backlog of tens of thousands of containers is likely to cause delays that will be felt around the world.

Authorities responded to complaints about the soaring cost of “zero-COVID” by switching to a more targeted approach of isolating buildings or neighborhoods with cases instead of cities. But some areas covered by restrictions that have closed shops, factories and offices for weeks at a time have millions of inhabitants.

China’s economy grew by a weak 4.8% over a year earlier in the quarter ending in March. That was an improvement over the 4% rate in the final three months of 2021, but the current quarter’s economic indicators are dismal.

Auto sales in April fell by almost half from a year earlier. Retail spending was off by a worse-than-forecast 11%.

The ruling party is trying to shore up growth with tax refunds to entrepreneurs, easier credit and spending on building public works. The World Bank warned this week such “old playbook” policies might delay efforts to encourage growth based on consumption instead of debt-fueled investment.

High debts “store up further risks down the line,” the bank’s chief China economist, Ibrahim Chowdhury, said in a statement.

As Shanghai reopens, factories plan to have only half their employees on the job at one time to limit disruptions if there are more quarantines, according to foreign business groups. That will weigh on demand for imported components and raw materials.

“It will be months at least, and possibly years, before all the people who were working get back to work,” Carl B. Weinberg of High-Frequency Economics said in a report this week.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - Speaker of the House Kevin McCarthy, R-Calif., leaves the chamber at the Capitol in Washingt...

Associated Press

McCarthy rejects Senate spending bill while scrambling for a House plan that averts a shutdown

A government shutdown appeared all but inevitable as House Speaker Kevin McCarthy dug in Thursday.

4 days ago

(Photo by Mario Tama/Getty Images)...

Associated Press

Kari Lake reportedly plans to launch US Senate bid in Arizona for seat held by Kyrsten Sinema

Republican Kari Lake will soon launch her campaign for the U.S. Senate seat held by independent Kyrsten Sinema, a senior adviser said Thursday.

4 days ago

Republican presidential candidates, from left, former Arkansas Gov. Asa Hutchinson, former New Jers...

Associated Press

3rd Republican presidential debate is set for Nov. 8 in Miami, with the strictest qualifications yet

The third Republican presidential debate will be held in Miami on Nov. 8, a day after several states hold off-year elections.

10 days ago

During the equinox, the Earth’s axis and its orbit line up so that both hemispheres get an equal ...

Associated Press

The fall equinox is here. What does that mean?

The equinox arrives on Saturday, marking the start of the fall season for the Northern Hemisphere. But what does that actually mean?

10 days ago

Ray Epps Ray Epps, an Arizona man who became the center of a conspiracy theory about Jan. 6, 2021, ...

Associated Press

Ray Epps, an Arizona man who supported Trump, pleads guilty to Capital riot charge

Ray Epps, the target of a conspiracy theory about the Jan. 6, 2021, attack, pleaded guilty on Wednesday to a misdemeanor charge.

12 days ago

Former President Donald Trump repeatedly declined in an interview aired Sunday, Sept. 17, 2023, to ...

Associated Press

Trump refuses to say in a TV interview how he watched the Jan. 6 attack unfold at the US Capitol

Former President Donald Trump repeatedly declined in an interview aired Sunday to answer questions about whether he watched the Capitol riot.

15 days ago

Sponsored Articles

...

SCHWARTZ LASER EYE CENTER

Key dates for Arizona sports fans to look forward to this fall

Fall brings new beginnings in different ways for Arizona’s professional sports teams like the Cardinals and Coyotes.

...

re:vitalize

When most diets fail, re:vitalize makes a difference that shows

Staying healthy and losing weight are things many people in Arizona are conscious of, especially during the summer.

...

OCD & Anxiety Treatment Center

5 mental health myths you didn’t know were made up

Helping individuals understand mental health diagnoses like obsessive compulsive spectrum disorder or generalized anxiety disorder isn’t always an easy undertaking. After all, our society tends to spread misconceptions about mental health like wildfire. This is why being mindful about how we talk about mental health is so important. We can either perpetuate misinformation about already […]

China’s trade rebounds in May as anti-virus curbs ease