Giant Canton Trade Fair starting to lose its lustre with drop in exhibitors
Number of exhibitors slips due to subdued global economy and other cities are starting to give it a run for its money
The number of exhibitors at the autumn session of the mainland's largest trade fair, opening today, has fallen the most since 2009 due to a subdued global economy and weaker currencies in emerging markets.
The twice-yearly Canton Fair, held in three gigantic conference halls in eastern Guangzhou, is a gauge of the mainland's export performance in the following six to nine months.
At a time when the recovery of the US economy is being undermined by concerns about the debt ceiling, the number of exhibitors at the 114th Canton Fair has fallen by 229 to 24,517, the largest drop since 2009, when the global financial crisis saw the number of exhibitors at the spring fair fall by 237. This year is the first time exhibitor numbers have fallen at both the spring and autumn fairs. In 2009, the number of exhibitors rebounded at the autumn fair following the dip in spring.
"The fall in the number of exhibitors hints that the initial recovery in the mainland's export growth will be thwarted by the uncertainty in the US economy," said Linus Yip Sheung-chi, a strategist at First Shanghai Securities. Mainland exports fell 0.3 per cent year-on-year last month after rebounding in July and August. A fall in exports to Southeast Asia, which hit a 17-month low, took most of the blame.
Emerging markets were one of the driving forces at the spring fair, accounting for more than a third of total contract value. But the negative impact of currency depreciations in emerging markets, including Russia, India, Malaysia, Indonesia, Peru, Thailand and the Philippines, would hang over the autumn fair, economists said.
The decline in exhibitors was the result of a "selection of strength" policy to ensure the quality of the exporting companies, Canton Fair spokesman Liu Jianjun said yesterday.
Guangzhou University economist Liu Songping, an expert on fairs and exhibitions, said a muted outlook for exporters, combined with a steep rise in operating costs for mainland manufacturers, meant the number of small- to medium-sized enterprises was on the decline.
"Only the leading companies or the companies that have their own branding could survive this tough economic situation," Liu said.
Fair spokesman Liu said the number of overseas buyers was expected to be on par with last autumn's session, which saw the number fall 10 per cent to 188,145.
He said an increasing number of big trade fairs in various cities, including Beijing, Shanghai and Yiwu , the largest wholesale market for small commodities on the mainland, meant the long-term importance of the Canton Fair was declining.