Economic Watch: The chief economist expects China's exports to continue to improve in the second half of the year

China's export data for the first half of the year will soon be released. Several chief economists predict that China's exports will continue to pick up in the second half of the year, leading to a further recovery in exports.
Recently, as major economies continue to restart their economies, China's exports have become more warm. In renminbi terms, exports grew 1.4 per cent in May from a year earlier, beating market expectations. The year-on-year decline in exports narrowed to 4.7 per cent in the january-May period. In dollar terms, exports fell 3.3 per cent in May from a year earlier and 7.7 per cent in the first five months.
Lu Zhengwei, chief economist of Industrial Bank, said overseas demand will gradually recover in the future if there is no large-scale rebound in the epidemic. Continued improvement in external demand combined with the low base effect will drive the year-on-year growth of China's foreign trade exports to pick up in June. On the import side, global demand for iron ore, cement, grain and other resources transport is rising, while China, as the world's major commodity importer, import growth will also resume.
Zhang Yu, chief macro analyst at Huachuang Securities, also predicted that China's export recovery could be expected in the context of the rapid economic recovery overseas. In dollar terms, the year-on-year decline in Exports will narrow to 0.2 per cent in June.
Analysts believe that taking into account a number of positive factors, China's foreign trade exports in the second half of the year is expected to improve further.
On the one hand, the gradual recovery of the global economy will drive foreign demand out of the trough.
In recent days, there have been a steady stream of positive signs that the global economy appears to be coming out of the worst of times. In June, non-farm payrolls rose 4.8 million month-on-month, much more than expected, and the unemployment rate fell to 11.1%. Final PMI readings for France and the UK both exceeded the 50 mark, indicating expansion.
Xiangdong Pan, chief economist at New Times Securities, notes that South Korea, a typically export-oriented economy, saw exports grow by more than 20 per cent year-on-year in the first 10 days of June. Moreover, the Baltic Dry index (BDI) rose 203 per cent in The year to June 18th from May, two signs that the "dark hour" in global trade may be passing. As a result, China's export recovery is expected to accelerate in the second half of the year.
In the view of Zhesang Securities chief economist Li Chao, In the future, China's export has three strong support: epidemic prevention materials export is still accelerating, has a pull effect on the entire export; Overseas economies are gradually restarting, and external needs are accelerated. The global industrial chain is in the remodeling stage. China's leading economic recovery occupies an advantageous position in global competition, which is conducive to boosting foreign trade exports.
Chief economist at Morgan Stanley xing ziqiang also said that although the outbreak brought significant impact to global trade, Chinese export market share of global trade are still continued the growing trend for the past three years, show that China is improving in the position in global value chain, exports still has strong competitiveness relative to other countries. As the global economy recovers in the second half of the year, China's exports may bottom out in the coming months.
On the other hand, global trade activity is accelerating.
Thailand has allowed the entry of businessmen and professionals from China, Japan, South Korea, Singapore and other countries since July 1.
Japan will hold talks this month with China and South Korea on easing entry and exit restrictions in an effort to resume business contacts, the Asahi Shimbun reported.
China, Singapore, Australia, New Zealand and other 12 countries issued a joint statement recently, proposing to avoid export controls or the establishment of tariff and non-tariff barriers and to remove any existing trade restrictions on essential goods, especially medical supplies.
Many Chinese foreign trade enterprises are also optimistic about the export performance in the second half of the year. Zhuhai Kelitong Electric Appliance Co said new orders signed between January and May were up more than 20 percent from the same period last year, and it expects exports to grow 20 to 30 percent for the full year. Wang Lixin, chairman of Darente Crafts, says the company has been inundated with orders' to the point where workers are overwhelmed. '