China's May exports plummeted, 'year-end bottom of the second half of this year'

China's May exports plummeted, 'year-end bottom of the second half of this year'

China's May exports plunged four times more than expected, prompting analysts to "decrease further in the second half of the year and hit the bottom at the end of the year."
On the 22nd of last month, Deputy Prime Minister Choo Kyung-ho presented the 'lowest point in May' at the National Assembly, strengthening economic stimulus policies based on the expectation of a year-end trade surplus in the 4th quarter trade brisk, presented successively.
China's May exports plummeted 7.5% and imports fell 4.5%, continuing the decline in exports from China until the end of the year, making Korea's September trade surplus less likely to rebound.
Bloomberg reported on the 7th that exports announced by the China Customs Administration on the 7th fell 7.5% to $284 billion, a four-fold decrease from the 1.8% decline predicted by experts.
Imports from China fell 4.5 percent to $217.7 billion, half the 8 percent drop expected by Bloomberg analysts, and the trade surplus was tallied at $65.8 billion.
"While imports declined much faster than expected, imports extended the decline, coupled with a bleak outlook for global demand, especially developed markets, raising doubts about a fragile economic recovery," Reuters said of the Chinese economy. Growth was faster than expected in the first quarter, driven by strong service consumption and backlogs following several years of Covid disruption, but factory output slowed as interest rate hikes and inflation dampened demand in the US and Europe.”
Commenting on the sharp drop in China's exports, Zhiwei Zhang, chief economist at Pinpoint Asset Management, said: "The slump in Chinese exports confirms that China will have to rely on domestic demand as the global economy slows." That puts more pressure on the Chinese government to boost domestic demand for the rest of the year," he told Reuters.
In China, imports of semiconductors fell 15.3 percent in May as exports of home appliances plummeted, and the Purchasing Managers' Index (PMI) released last week showed that factory activity contracted faster than expected in May, according to Reuters.
New orders, including new exports, have already fallen for two months, leading analysts to downgrade their forecasts for the remainder of the year as China's factory output slows, Reuters said. .
"I think going forward, Chinese exports will fall further before bottoming out later this year," said Julian Evans-Pritchard, head of China economics at Capital Economics. "Weakened activity in developed economies later this year will trigger a mild recession in most cases," he told Reuters.
In a World Bank report released on the 6th, World Bank Chief Economist Ayhan Kose said, "The sunlight we saw earlier this year on the global economy is fading, and a gray day lies ahead." “We are experiencing a “global slowdown” and 65% of countries will experience slower growth this year than last year,” he told The New York Times.
Regarding the World Bank report, the NYT said on the 7th that “the poor financial management of low-income countries that rely on borrowed money is further complicating the problem,” and “15 out of 28 low-income countries are in debt crisis.”