BEIJING: China's exports plunged the most in three years in June, falling a more than expected 12.4% year-on-year, as tensions from the struggling global economy show signs of escalating and Chinese policymakers face mounting pressure. facing. for promotional measures.
Customs data on Thursday showed imports also fell more than expected, falling by 6.8%. A Reuters poll of economists had forecast a 9.5% drop in exports and a 4.0% decline in imports.
The pace of China's post-pandemic recovery has slowed after rising sharply in the first quarter, with analysts now downgrading their projections for the economy for the rest of the year as factory production slowed due to persistently weak global demand. Is.
Lav Daliang, spokesman for the General Administration of Customs, blamed "weak global economic recovery, slowing global trade and investment, and rising unilateralism, protectionism and geopolitics" for the poor export performance in remarks at a press conference in Beijing.
Policymakers are now staring at the prospect of slowing growth to just 3% a year in the world's second-largest economy, according to economists' forecasts. This is less than half the normal rates of recent decades and creates a sense of an economy in recession.
Chinese Premier Li Keqiang, who took office in March, has talked a good game on implementing policy measures to boost demand and strengthen markets, but few concrete steps have been announced and Investors are getting impatient.
"Looking ahead, headwinds facing the external sector remain strong, requiring policy support for domestic demand," said Zhou Hao, economist at Guotai Junyan International.
South Korean shipments to China, a leading indicator of China's imports, fell 19.0% last month, the smallest decline since October, but the decline in semiconductors and other components used to manufacture electronic goods Demand remains weak.
Raw material demand also showed signs of weakness, with copper imports falling 16.4% in June from a year earlier.
Chinese factory activity has been shrinking in recent months, while consumer prices edged into deflation in June and producer prices fell at their sharpest pace in more than seven years.
After badly missing the 2022 target, the government has set a modest GDP growth target of around 5% for this year.
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