China exports rise for first time in 6 months

China’s exports rose in March for the first time in six months, customs data showed Thursday, as the world’s second-largest economy continued its recovery following the end of onerous coronavirus curbs late last year.

The 14.8 percent surge in overseas shipments marked the first since September, according to the General Administration of Customs, and will provide a boost to hopes for a lasting rebound.

Beijing long maintained some of the world’s strictest Covid curbs, persisting with snap lockdowns and lengthy quarantines despite their increasingly dire economic consequences.

The government abruptly ditched the restrictions in December, and a wave of cases afflicted the operations of many businesses for several weeks.

Thursday’s customs figures contrasted with a poll of analysts conducted by Bloomberg News, who predicted that exports would decline 7.1 percent.

The sharp uptick was a “positive surprise”, said Zhiwei Zhang, president and chief economist at Pinpoint Asset Management.

However, he added that the sharp rebound “may be partly due to a low base effect”, noting that Covid outbreaks in March last year forced many Chinese factories to shut down and restricted operations at the country’s ports.

“The other factor behind the strong export growth may be the inventory and order cycles for exporters,” Zhang said in emailed comments to AFP.

While the torrent of Covid cases in December and January “likely depleted factories’ inventories”, they are now running at full capacity and have “caught up the cumulated orders from the past”, he added.

Imports in March contracted 1.4 percent, a more moderate pace than in January and February.

China’s economy grew just three percent in 2022 — one of its slowest rates in decades — and the country has set a modest target of “around five percent” for this year.

There is optimism that goal can be reached, with the International Monetary Fund on Tuesday maintaining its annual growth forecast for China at 5.2 percent.

China’s year-on-year trade with the United States fell 17.4 percent, and dropped 10 percent with the European Union, Thursday’s figures showed.

But there was a sharp 25.9 percent increase in trade with Russia as Moscow focuses on business with its giant neighbour after being hit with sanctions following its invasion of Ukraine.

“As Covid-19 waves subsided in January of this year, mobility normalised, and high-frequency economic indicators — such as retail sales and travel bookings — started picking up,” the IMF wrote in its World Economic Outlook report.

“The reopening and growth of (China’s) economy will likely generate positive spillovers, with even greater spillovers for countries with stronger trade links and reliance on Chinese tourism,” it added.

Top Chinese leaders have also signalled a focus on recovery, with new Premier Li Qiang last month telling a major economic forum that the country was showing “strong momentum”.