With a growth in demand because of a fast rebound of the United States economy from the Covid-19 pandemic hit, there was an unexpected surge in the exports of China last month.
The global export market of China was also partially boosted by the slowing down of factory production in India because of very severe second wave of the pandemic with which the country is struggling to cope up with.
There was a more than 32 per cent year on year surge in the exports of China last month in dollar terms to reach almost $264bn. In that very month, the pace of imports in China also was the fastest for the country in more than a decade as imports grew by 43 per cent compared to the same month a year ago.
The exports from China for last month was almost $43bn more than its imports – which was more than a three time increase for the month year on year,even though there is currently a trade war still on-going with the United States while it is having trade and other issue with other countries as well such as with Australia and the European Union.
However economists say that the growth in exports and imports are heavily askew because the numbers are set in comparison to the same period a year ago when the country had been virtually brought to a standstill because of severe lockdowns and restrictions imposed by the government to prevent the spread of the Covid-19 pandemic.
Analysts and economists also foresee some $43bn more than its imports in the path for the second largest economy of the world staging a fast recovery from the pandemic hit.
There are expectations that the gross domestic product growth of the country will slow down from the record growth of 18.3 per cent it experienced in the first quarter between January and March. That is because supply chains around the world continue to remain disrupted because of the Covid-19 pandemic which is expected to slow down the movement of goods and a consequent rise in the cost of shipping. Manufacturers are also being hurt because of the global shortage of microchips, which are used in everything from cars to phones.
Factory activity growth slowed in April from the previous month, showed China’s official manufacturing purchasing managers’ index last week.
And China suspended key economic dialogue with Australia “indefinitely” on Thursday in the latest tensions between the two countries which started with a diplomatic tussle between the trading partners. Since Australia called for a probe into the origins of Covid-19 and banned Chinese telecom firm Huawei from participating in the 5G roll out in the country, the two trading partners have seen tensions between them rise. Sanctions on Australian goods such as wine and beef were imposed by China last year. Australia was accused of having a “Cold War mindset”, in a statement issued by a Chinese government commission.
(Adapted from BBC.com)