Economy

China’s external demand is at greater risk in Q4 by Stocksak


© Stocksak. FILE PHOTO – Containers seen at the Yangshan Deep-Water Port, Shanghai, China, October 19, 2020. REUTERS/Aly Song

BEIJING (Stocksak), – China’s economy faces growing risks of slowing foreign demand in the fourth quarter, a spokesperson for the commerce ministry said on Thursday. He also stated that uncertainties were overshadowing China’s growth in foreign trade.

Shu Jueting, spokesperson for China’s commerce ministry, stated that as the world economy loses momentum the environment for trade was becoming more complicated for China.

She said that she expected the risk of slowing foreign demand to increase as she looked into the fourth quarter.

China’s exports rose 5.7% in September from a year earlier, the slowest pace of growth since April. Imports rose by 0.3%, a small increase that is well below the 1.0% forecast.

It is happening as global economic growth is being slowed by monetary tightening around the globe to contain rising inflation.

Shu said that despite the difficulties, conditions were still favorable for stable growth of trade between China, other countries, and Shu agreed.

Beijing’s strict zero COVID strategy has also made it difficult for sectors that are most vulnerable to pandemic restrictions like services.

Shu stated, “The consumption market continues to recover and grow trend, but because of unexpected factors like the COVID epidemics, market entities within sectors brick and mortar retail and catering still face immense pressure.”

She expects that consumption will rebound once policy support is in effect.

China’s retail sales, a measure of consumption, grew 2.5% last Month, exceeding expectations. This is a sign that domestic demand remains fragile.

Even if the economy rebounds at a faster-than-anticipated clip in the third quarter, a long-term recovery will be challenged by persistent COVID-19 curbs, a prolonged property slump and global recession risks, economists say.

Stocksak poll showed that China’s growth will slow to 3.2% in 2022. This is far below the official target of 5.5%. It was one of the worst performances for almost half a century.

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Stocksak Editorial

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