Chinese exports rebound

Official figures released on Wednesday showed that China's exports in March jumped 11.5 percent from a year earlier, to $160.8 billion (141.6 billion euros), snapping an eight-month streak of declines caused by waning global demand.

This is the first increase since June last year and the highest percentage rise since February 2015.

Imports, on the other hand, continued to fall but less than expected, declining by 7.6 percent in dollar-denominated terms to $131 billion, led by sharp corrections in imports of tax-free foreign goods, rentals and leasing and imported equipment. However, import volumes of most major commodities, notably copper and iron ore, rose strongly.

The export rebound has fuelled hopes that a growth slowdown in the world's second-largest economy may be coming to an end.

The trade data "add to growing evidence that the extreme gloom of a few weeks ago" about China's economy was "misplaced," said economists at Capital Economics, a London-based consultancy.

Investors welcomed the news, sending the benchmark Shanghai composite index 1.4 percent higher on Wednesday to 3,066.64 points, the highest closing level since Jan. 8 of this year.

But economists pointed out that the latest figures were helped by having a low basis of comparison, after exports plunged 15 percent year-on-year in March 2015, and seasonal distortions from the Lunar New Year holiday. They cautioned that the upturn in exports was not necessarily due to stronger global demand.

Global impact

After decades of double-digit expansion, China's economy grew 6.9 percent in 2015, the weakest in a quarter of a century, as its leaders try to transition it from one driven by government investment and exports to domestic consumer demand.

The International Monetary Fund said Tuesday that China's slowdown might not be quite as severe as initially feared but its "momentous" shift from investment-led growth is still having a chilling effect on trade globally.

The IMF estimates every one percentage point investment-driven drop in China's GDP, cut growth for the entire Group of 20 nations by 0.25 percentage points.

"Even countries that have few direct trade linkages with China are being affected through the Chinese slowdown's impact on prices of commodities and manufactured goods, and on global confidence and risk sentiment," the Fund noted.

Key economic data, including first-quarter economic growth, are expected this week. The government aims for economic growth of 6.5 to 7 percent this year.

sri/cjc (Reuters, AFP)