As Global Demand Bounces Back, China’s Exports Boost
In 20 years, the growth of China’s exports has reached its highest point recently, as reflected by the official data. The imports also surged in a rebound to the coronavirus pandemic because of which activities had come to a standstill.
Reportedly, in January and February of this year exports had increased by 60.6%, after the industries came out of lockdown. The factories reopened and the international demand revived, gradually picking up pace after the pandemic. Exports increased to $468.9bn, stimulating from last year’s 18.1% increase and the growth was almost twice what was predicted by forecasters.
What contributed to the increase in exports was a growing demand for electronics and textiles. People required protective gears and masks etc. as shields against the coronavirus, due to which the textile exports surged. Similarly, work-from-home resulted in an increase in the supply of electronics and other related products.
In December the increase in imports was 6.5% but it has now jumped to 22.2% which translates to $365.6bn. This shows that the global economy is on a road to recovery.
The trade data for the initial two months of a year are combined by the Chinese authorities. This is to recompense for the oscillation caused by the Lunar New Year holiday, falling at different points each year. The industries close for almost two weeks and then are replenished after reopening.
China’s economy reopened relatively earlier than other economies of the world and this benefitted the country’s exporters. While others still faced the threats of the coronavirus, China had already declared victory over it.
Experts have forecasted that as a demand for medical supplies and masks relaxes the increase in Chinese exports will also slow down. What will add to this deceleration is also the fact that the rest of the global markets are also on their way to recovery.
Currently, China doesn’t have much competition. While the global economy is recuperating, nonetheless they are still being largely affected by the coronavirus and going into lockdowns again. The global situation is still serious and complicated as warned by the trade officials.
Over last year, the exports to the United States increased to 87.3%, resulting in $80.5bn in just two months this year. The increase is in spite of the unfair tariffs imposed by the Trump Administration that remain in place by the Biden Administration also.
Political analysts and economists expected few modifications by the Biden Administration, and a US-China Phase One Deal was also signed. However, it is yet to be seen how far the relationship between the countries goes.
Premier Li Keqiang, a Chinese politician also recently announced that the country planned to boost the development of technology. This was to reduce its reliance on other nations. If China continues to reduce its reliance on other countries then those that exported to China are likely to face some problems.