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China's exports jumped the most in a year and declines in imports narrowed, adding to evidence of stabilisation in the world's second-biggest economy.
Overseas shipments rose 11.5 per cent in dollar terms in March from a year earlier, compared with a 25 per cent slump in February, when factories and offices were closed for a week-long holiday. Imports extended declines to 17 months with a 7.6 per cent drop, data showed on Wednesday. The trade surplus decreased to $29.9 billion, the least in a year.
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The export rebound may suggest China's economy fared better than expected in the first quarter, with data due on Friday expected to show a 6.7 per cent expansion for the period. The increase in shipments may indicate more than seasonal factors and could show a pickup in demand, said Iris Pang, a greater China economist at Natixis SA in Hong Kong.
"This is quite encouraging indeed," she said. Still, it's too soon to conclude that the worst is over for the nation's exporters, and "we need more evidence to confirm that the whole manufacturing sector is on track again."
The Shanghai Composite Index advanced 1.4 per cent to close at a three-month high, paring this year's decline to 13 per cent. Shares also gained from Hong Kong to Tokyo.
"The steep decline in trade is coming to an end, but whether such a recovery can be sustained is still questionable," said Liu Dongliang, a senior analyst at China Merchants Bank in Shanghai. The data "reflects improving external demand, a rebound in commodity prices and recovering domestic demand." Seasonal factors aided the recovery. The week-long lunar New Year holiday fell in February this year, closing factories and curbing shipments. That saw exports tumble 25.4 per cent in US dollar terms from a year earlier, the biggest decline since May 2009.
"Figures around this time of year are enormously impacted by seasonal factors," said Ben Simpfendorfer, founder of research firm Silk Road Associates in Hong Kong. "Exports are weak and likely to remain so over the coming months." In yuan terms, overseas shipments rebounded 18.7 per cent from a year earlier and imports slipped 1.7 per cent, the Customs General Administration said.
The narrower decline in imports reflects a pickup in commodity prices and improving demand from China's consumers, said Xia Le, chief economist for Asia at Banco Bilbao Vizcaya Argentaria SA in Hong Kong. "The economy is starting to stabilise not only on the domestic side but also on the external one."
Exports to the US increased 9 per cent, while those to EU nations jumped 17.9 per cent. Shipments to Brazil plunged 39.4 per cent. Imports from the US fell 2.8 per cent, while those from Canada tumbled 32.3 per cent. China's imports from the EU rose 1.4 per cent. Many economic indicators improved in the first quarter, Premier Li Keqiang said in a recent meeting with Germany's foreign minister, according to a report last week by Chinese state television. The improving trend in the economy is not solid, impacted by a sluggish global economy and market volatility, Li said.
China investment in US touches record high
Chinese direct investment in the US rose to a record last year, driving the total number of jobs linked to it to the highest ever, according to a report by the National Committee on US-China Relations and Rhodium Group.
Investors from China put more than $15 billion into 171 transactions in the US in 2015, and more than $30 billion of deals and projects are already pending for this year, according to the study.
The report cited data compiled by Rhodium's China Investment Monitor, which has tracked mainland Chinese-owned firms' direct investment in the US since 2000. They helped add 13,000 full-time jobs for Americans last year, bringing the total number over the past 15 years to more than 90,000, according to the report.
