China’s exports fall 23% in April

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China’s exports continue to disappoint. They fell 18% in January and 26% in February. March showed a slightly better performance, with a 17% fall. But April was weak again, with a 23% decline in exports and imports.

China’s problem today is based on its past success in becoming the manufacturing capital of the world. Exports now account for 37% of GDP, compared to 20% in 2001. And they are focused on durable goods such as refrigerators and microwaves, where sales are directly linked to the health of Western housing markets.

As Nobel Prize-winning economist Paul Krugman noted in Shanghai today, “I think it’s difficult to see where a great revival of existing Chinese exports to the U.S. will come from. The U.S. is almost certainly going to be facing bleak consumer spending for an extended period.”

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. The aim of this blog is to share ideas about the influences that may shape the chemical industry over the next 12 – 18 months. It will try to look behind today’s headlines, to understand what may happen next in important issues such oil prices, economic growth and the environment. We may also have some fun, investigating a few of the more offbeat events that take place from time to time. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.

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