Canton Fair points to dim outlook for China exports
Although transactions at the event fall below US$30b amid a decline in buyers, September trade data shows signs of recovery in third quarter
Export transactions at the autumn session of the Canton Fair, China's largest trade fair, dropped 6.1 per cent compared with the spring session this year to US$29.16 billion, the second-lowest transaction value since the 2008 global financial crisis.
The number of buyers who visited the trade fair was also down 1.07 per cent to 186,104.
The trade fair, held twice a year in eastern Guangzhou, has long been seen as a gauge of China's export performance in the next six to nine months.
The value of export transactions at the autumn session, which closed yesterday, was the lowest in five years. The last time the transaction value fell below US$30 billion was in the spring of 2009, when the trade fair reported a transaction value of US$26.23 billion in the aftermath of the global financial crisis.
"There has not been a strong recovery in the traditional [export] markets, while demand from the emerging markets has also been weak," trade fair spokesman Liu Jianjun told a press conference yesterday.
Mainland China's export transactions with major trading partners, including the European Union, the United States, the other BRICS countries - Brazil, Russia, India and South Africa - the Middle East and Japan, all dropped at the autumn session, with the declines ranging from 4 per cent to 19 per cent.
But transactions with members of the Association of Southeast Asian Nations, Hong Kong and South Korea increased.
The transactions were still dominated by short-term orders. Liu said orders with durations below three months accounted for 47.5 per cent of the transactions and those with durations of three to six months accounted for 35.6 per cent, while long-term orders with durations of more than six months only accounted for 16.9 per cent.
Liu said it would normally take several months for orders signed at the trade fair to come into effect.
Due to the impact of the Ebola virus, the number of buyers from Africa fell 13.77 per cent. Liu said buyers from countries affected by the virus, including Guinea, Liberia, Sierra Leone and the Democratic Republic of Congo, had declined 29.9 per cent.
Although figures at the Canton Fair suggest a gloomy outlook for exports, China's trade data showed some signs of recovery in the third quarter after weak performance in the first half. September trade data showed monthly exports grew 15.3 per cent year on year, while imports grew 7 per cent, after falling 2.4 per cent in August.
"With European air freight and Asian shipping growth broadly steady, the bounce in US container shipping volumes points to a modest pick-up in global trade in September," said Zahra Ward-Murphy, a strategist at Absolute Strategy Research, an economic research institution.
She said the inbound volume of US container throughput increased 10 per cent year on year in September, regaining the 2007 level.