Last month, China’s imports and exports decreased more drastically than anticipated as lower global demand jeopardized the chances of the world’s second-largest economy recovering.
According to official data, imports decreased by 12.4% in July compared to the same month last year while exports plummeted by 14.5%.
The dismal trade numbers increase worries that the nation’s economic development may slow down much more this year.
Beijing will be under more pressure to speed up the post-pandemic recovery.
The poorest export numbers since February 2020 point to a potential impact on China’s post-pandemic recovery from higher living expenses and more expensive borrowing costs in other areas of the world.
Demand has also lagged behind expectations in China, where the economy has not recovered despite three years of harsh lockdowns and restrictions meant to stop the coronavirus from spreading.
Due to its status as the largest exporter and greatest importer in the world, China’s slow trade performance is expected to have an impact on the global economy.
Prices in China, in contrast to most of the rest of the world, seem to be declining as businesses and consumers emerge from the zero-growth period unwilling to spend and with big inventories of items to sell.
However, officials in China have so far resisted taking any significant steps to revive the economy in the face of soaring youth unemployment and a housing industry in crisis.
One of China’s largest markets, the US, saw a 23.1% year-over-year decline in exports.
Additionally, the European Union imported 20.6% less from China. Due to a dispute between the EU and China over semiconductor chips, some of the important raw materials used to build computer chips are now subject to more stringent export controls from China.