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          BIZCHINA> Top Biz News
          Foreign trade shrinks
          By Ding Qingfen (China Daily)
          Updated: 2009-06-12 09:27

          Foreign trade shrinks

          Trucks transporting containers for exports at the Tianjin Port.[Xinhua]

          China's foreign trade contracted for the seventh consecutive month in May, notwithstanding the improvement in the US Consumer Confidence Index (CCI) and the stimulus policies announced by the central government.

          Foreign trade in May fell to $164.13 billion, down 25.9 percent, according to statistics released by the General Administration of Customs yesterday.

          Exports in May sank by 26.4 percent on an annual basis to $88.76 billion, while imports fell by 25.2 percent year-on-year to $75.37 billion. The net trade surplus for May is around $13.39 billion.

          Related readings:
           China's foreign trade down for 7th month
           China's foreign trade set to decline in first half
           Foreign trade sector faces 'gloomy times'
           Six regions compete for yuan settlement in foreign trade

          Though the trade decline is wider than the previous month, analysts said the worst seems to be over for now. They expect the fall in exports to ease up over the next two to three months, and are confident that a recovery would set in during the last quarter when the US and European economies start to bottom out. European Union, the US, Japan and the ASEAN continue to be the top four trading partners, but trade with the regions fell 22.1, 17.1, 24.6, and 25.9 percent respectively.

          "The decline is within our expectations, given the sluggish economies in the US and Europe and the high reference point in May 2008," said Li Jianfeng, trade and macroeconomy analyst from Shanghai Securities.

          "The economic problems of China's major trading partners (the US, Europe and Japan) has made it impossible for the trade and exports to improve in such a short period of time," Li said.

          The US Federal Reserve predicted that the US economy will drop by 1.3 to 2 percent this year, the lowest since 2001, while the jobless rate is likely to hover around 9.2 to 9.6 percent, the highest in the past two decades.

          Since last August, the Chinese government has raised tax rebates for exports seven times, and the latest was on Monday. Premier Wen Jiabao said on May 27 that China would offer incentives to help exporters as external demand is the most challenging part of Chinese economy.


          (For more biz stories, please visit Industries)

           

           

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