Chinese exports jump 14.5pc
Despite a 14.5pc rise last month, doubts remain over whether the rebound can be sustained
The mainland's surprisingly robust export data bolstered hopes for a further economic rebound, but analysts and industry players say the strong momentum may be hard to sustain.
Analysts say falling imports pointed to persistent downside risks, indicating authorities may maintain the intensity of stimulus measures, as leaders are believed to be discussing policies on the economy and politics at their annual meeting at the northern coastal resort of Beidaihe.
Exports soared 14.5 per cent last month, greatly exceeding market expectations for a 7 per cent rise and also double the 7.2 per cent growth in June.
The data came as analysts questioned the sustainability in the rebound of the economy, which picked up slightly to 7.5 per cent in the second quarter from 7.4 per cent in the first.
Imports, however, dimmed the rosy picture by showing a 1.6 per cent decline in July, in part due to a high comparison base and weakening commodities prices, after rising 5.5 per cent in June. The data trailed the market consensus for a 2.6 per cent gain.
The trade surplus surged to US$47.3 billion in July as a result. The surplus was 1.7 times the level a year earlier and compared with US$31.6 billion in June.
"I have been pondering what has pushed exports in July to grow so fast. The reasons appear to be scarce for such a decent performance, although a recovery was well expected," Mizuho Securities' chief China economist Shen Jianguang told the South China Morning Post. He said growth of about 7 or 8 per cent for exports would be "good enough".
Royal Bank of Scotland economist Louis Kuijs also said "it is too early" to judge the trend of global demand based on China's single-month data. He believes Beijing will continue to roll out measures to support growth, "without resorting to a major general stimulus."
Exports to the euro zone and the United States both accelerated last month to 17 per cent and 12 per cent respectively, compared with 13 per cent and 8 per cent in June. Shipments to South Korea soared 32 per cent, while exports to the Association of Southeast Asian Nations grew 12 per cent.
Xu Wenbin, chairman of Shijiazhuang Artweaver, an exporter of Chinese handmade rugs, told the Post that he felt "there's not any reason to be optimistic" about the mainland's long-term trade growth as he was more concerned about rising domestic costs. Each year, labour costs climbed about 10 per cent, he said. Moreover, the government's intensified anti-pollution campaign made many small raw-material suppliers struggle to cope with a sudden rise in environmental-related costs, he said.
The value of imports of goods such as crude oil, iron ore, and coal fell sharply last month as commodity prices declined.