China's Exports Increase, Economic Prospects Are Not Resilient

Solid Chinese exports are driven by shipments of goods to the US, Europe and Southeast Asia. However, China's imports slowed quite drastically.

On Friday (14/January), China's National Bureau of Statistics released data for December 2021 exports which increased by 20.9 percent year-over-year (Year-over-Year). Although higher than the forecast for a 20 percent increase, this figure is lower than the 22 percent growth in November.

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China's exports are mostly supported by shipments to the US and Europe, two regions that have been China's main trading partners. In addition, shipments of Chinese products to Southeast Asia increased by 12 percent to $49.76 billion.

"We expect China's export trend to remain strong in the first quarter of 2022 as global demand becomes more resilient, despite the surge in Omicron COVID cases in many developing countries," said Zhang Zhiwei, a China trade official.

Import Growth Declines, Market Worries About Economic Prospect

The increase in China's exports did not appear on the import side. Shipments from overseas increased only 19.5 percent year-on-year in December. This figure is lower than the expectation of an increase of 26.3 percent, as well as much slower than the growth in the previous period which reached 31.7 percent.

China's Exports Solid, Prospect of Slowing

Referring to the export-import data this afternoon, China's trade balance increased from $71.72 billion to $94.46 billion in December. This change was mainly due to the drastic drop in import volumes.

The emergence of the latest variant of COVID, global supply chains that have not been normalized, and high inflation throughout 2021, make China's trade is expected to face many challenges this year.

"For 2022, trade faces increasing uncertainty, instability and imbalance. China's economy is facing pressure from three directions, including demand contraction, supply stagnation, and a more bleak outlook," said Li Kuiwen, a spokesman for Chinese customs.

Even so, Li Kuiwen is optimistic that in facing these challenges and difficulties, the domestic economy is still quite resilient and fundamentals remain positive in the long term.