China’s trade numbers fell in July, according to government data released on Tuesday, a sign that the country’s economic recovery is lagging behind despite efforts by Beijing authorities to revive growth.
Exports from China, which has the world’s second-largest economy after the United States, have fallen for three straight months, while imports have fallen for five straight months. The figures reflect falling foreign demand for products made in China, weak domestic demand, the housing crisis and geopolitical tensions, including the war in Ukraine.
Economists at Nomura wrote in a note to investors that exports are likely to continue to decline for the rest of the year.
“These readings indicate a deterioration in growth prospects,” they said. “A worsening contraction in exports means weaker production, while a rapid deterioration in imports reflects weaker demand in China.”
China’s exports fell 14.5% in July from the same point a year ago, the biggest drop since February 2020, when the coronavirus pandemic brought the world to a standstill and tangled global supply chains. Imports fell by 12.3% in the same period.
In the first seven months of the year, exports to the United States fell 18.6% compared to the same period last year, while shipments to the European Union fell 5%. Exports to Russia, which was subjected to Western sanctions for its invasion of Ukraine, increased by more than 70%.
Mexico and Canada surpassed China This year, as the United States’ best trading partners, US companies are looking to bring their supply chains closer to home. Foreign investment in China fell more than 80% in the second quarter of this year compared with the same point last year, according to Chinese government data released on Friday.
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