Tuesday, 16 July 2024

China’s trade records worst contraction in 30 months amid ‎lower demand ‎

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Chinese exports and imports contracted in November at the fastest pace in at least two and a half years, as weak demand globally and domestically, production disruptions caused by the Corona virus, and the stagnation of the real estate market at home led to increasing pressure on the second largest economy in the world.

According to “Reuters”, the decline came at a much greater rate than the markets expected, and economists predict more periods of decline in exports, highlighting a sharp contraction in global trade with consumers and companies cutting spending in response to fierce moves by central banks to curb inflation. ..

Official data on Wednesday showed exports contracted 8.7% in November year-on-year, a sharp drop after declining just 0.3% in October, the worst performance since February of 2020. Analysts had expected a 3.5% decline. ,

Beijing has begun to ease some of the most stringent anti-Covid restrictions, but shipments out of the country have been losing momentum since August, with soaring inflation, soaring interest rates in many countries and the crisis in Ukraine pushing the global economy to the brink of recession.

In light of the increasing pressure on the Chinese economy, state media reported on Wednesday that a high-level meeting of the ruling Communist Party was held the day before, stressing that the government’s focus in 2023 will be on stabilizing growth, enhancing domestic demand, and opening up to the outside world.

Widespread Covid restrictions also affected importers, and imports witnessed a sharp decline of 10.6 percent after falling 0.7 percent in October, against expectations of a 6.0 percent decline. This contraction was the worst since May 2020.

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