US and European economic issues and Chinese slowdown weigh on consumer demand.
BEIJING: China returned to a trade surplus in March but growth in exports and imports was weak as US and European economic woes and a Chinese slowdown weighed on consumer demand.
Exports rose 8.9% over a year earlier to $165.6 billion, while imports grew 5.3% to $160.3 billion, trade data showed Tuesday.
That growth was below China’s double-digit levels in recent years but in line with the combined January-February period, which analysts look at to screen out the impact of the Lunar New Year holiday, when companies close for a week or more.
Chinese demand has weakened following government controls imposed to cool inflation and steer the growth of the world’s second-largest economy to a more sustainable level after 2010’s explosive double-digit expansion.
Growth eased to 8.9% in the final quarter of 2011 after Beijing tightened lending and investment curbs. Analysts expect growth to fall still further in this year’s first quarter. Data on that are due to be released this week.
China’s flagging demand is a bad sign for Australia, Brazil and Asian economies that count on Chinese customers to buy oil, iron ore and industrial components.
The drop in export demand triggered by Europe’s problems last year prompted Chinese leaders to reverse course in December and promise more bank lending to shore up economic growth. There have been few major steps but analysts say Beijing is quietly expanding access to credit.
China’s global trade surplus was $5.3 billion, a turnaround from February’s rare monthly deficit of $31.5 billion. The country usually records one large monthly trade deficit early in the year as factories restock after the holiday break.
Export growth in January-February was 6.9%, while import growth was 7.7%.
China’s trade surplus with the 27-nation European Union, its biggest trading partner, fell 15% to $8.1 billion, reflecting the continent’s weak demand as it struggles with government debt problems.
The politically volatile trade surplus with the US expanded by 28% to $16.6 billion.
Chinese imports of crude oil, soybeans and other basic commodities rose in a sign of continued consumer demand. But purchases of metals and other industrial materials were off as manufacturers responded to lower foreign orders by cutting purchases.
Imports of rubber were down 26.4% from a year earlier and raw steel down 24.8%.
©The Canadian Press