BEIJING- China’s imports grew at their fastest pace in 10 years in May, fueled by surging commodity prices, while export growth missed expectations, likely weighed by disruptions caused by COVID-19 cases at major ports in the country’s south.
Exports in dollar terms grew 27.9 percent in May from a year earlier, slower than the 32.3 percent growth reported in April and missing analysts’ forecast of 32.1 percent.
“Export surprised a bit on the downside, maybe due to the COVID cases in Guangdong province which slowed down the turnover in Shenzhen and Guangzhou ports,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management, adding that turnover at ports in Guangdong will likely remain slow in June.
Major shipping companies have warned clients of worsening congestion at Shenzhen’s Yantian port in Guangdong province after the recent outbreak.
Zhang expects this shock to be transitory and the current outbreak in Guangdong to be brought under control in a few weeks.
In the meantime, Chinese exporters are grappling with higher raw material and freight costs, logistics bottlenecks and a strengthening yuan, which diminishes trade competitiveness.
However, a brisk recovery in developed market demand and disruptions caused by COVID-19 in other manufacturing nations are likely to bolster China’s exports in coming quarters, analysts say.
Zhang Yi, chief economist at ZhonghaiShengrong Capital Management, said the recent pick-up in imports of semiconductors, which have been in short supply, suggests China’s exports of relevant products would likely stay high in the second half of the year.
