Chinese exports drop as EU debt crisis heightens
Updated: 2011-12-11 08:18
By Li Jiabao and Ding Qingfen (China Daily)
BEIJING - The growth of China's exports in November has dropped to its lowest level since December 2009 as demand for made-in-China goods shrank due to the escalating European debt crisis.
Experts said the outlook of the nation's exports would be gloomier in the coming year.
China's exports in November still increased by 13.8 percent from a year ago to $174.46 billion, according to a release from China's General Administration of Customs on Saturday.
Excluding distortions in January and February each year, the rise was the most minimal since China's export resumed growth in 2009.
The trade surplus in November narrowed to $14.52 billion from $17.03 billion the previous month. Imports reached $159.94 billion in November while growth slowed to 22.1 percent from 28.73 percent in October.
Slowing global growth and the debt crisis in Europe dampened overseas demand and slowed exports.
"The growth of exports and imports both slowed in November but it is better than estimated, owing to orders for Christmas. But exports and imports will drop further in the future because the European crisis will keep spreading," said Wang Tao, head of China economic research at the UBS Securities.
After US President Barrack Obama further pressured China's foreign-exchange policy and trade practices last month, China's Vice-President Xi Jinping had called for the US to relax its technology export to China and further open doors for Chinese companies to invest in the US.
During the past 11 months, China's trade volume with the Europe Union (EU) rose by 19.2 percent to $517.11 billion, while its trade with the US totaled $405.43 billion up 16.9 percent. Both increases were weaker than China's foreign trade growth of 23.6 percent in the same period.
As the external environment deteriorates, China is focusing on strengthening trade with emerging markets. China's trade with members of the Association of Southeast Asian Nations (ASEAN) came up to $328.96 billion in the first 11 months, increasing 25.1 percent year-on-year while its trade with South Africa soared by 82.5 percent to $41.45 billion compared to a year ago.
However, experts forecast a darker outlook for next year's exports because of shrinking external demand and domestic pressures from higher wages, surges in land and raw material costs and the appreciation of the yuan.
"It is probable that China's year-on-year export growth will slide to a negative level at the beginning of next year," Wang Tao said.
Long Guoqiang, a senior researcher with the Development Research Center of the State Council, a think tank for policy-makers, said "the situation in the future will be more serious and China's export growth to emerging markets will also slow down next year".
Wang Shouwen, head of the foreign trade department of China's Ministry of Commerce, said at a briefing on Wednesday that "the situation for China's exports and imports will be severe next year".
"There will not be fundamental improvement in Europe or the US, while costs at home will stay as high as this year's. China will focus on expanding trade with emerging economies. Exports may grow if Europe's debt crisis does not get out of control next year."