«China’s export values continued to contract in August, but this mostly reflects lower prices. Export volumes continued to hold up well and are still above their pre-pandemic trend. We doubt this resilience will last, however, given the challenging outlook for global goods demand,» said analysts at Capital Economics.
China trade: headwinds remain despite August’s marginal improvement, rebound only short term
A narrowing decline of China’s exports in August has failed to ease market concerns, with analysts expecting external demand to remain soft in coming months, despite the traditional high season of Christmas looming.
Exports tumbled for the fourth consecutive month in August, falling by 8.8 per cent compared to a year earlier to US$284.9 billion, according to customs data released on Thursday.
The decline, however, narrowed from a fall of 14.5 per cent in July, and was above the forecast by Chinese financial data provider Wind for a drop of 9.5 per cent.
China’s EU relations have downshifted, and cheap cars are driving the change
In the southwest suburb of Liaoning province’s Shenyang, the commercial and industrial centre of northeast China, a 3.6km (2.2-mile) avenue boasts the Chinese name for German luxury automaker BMW.
Dubbed Baoma Boulevard, meaning «precious horse», the road’s first address accommodates the headquarters of BMW Brilliance, a joint venture between the German brand — which holds a 75 per cent share — and Chinese firm Brilliance Auto. Having sold more than 5 million passenger cars and earned handsome profits in mainland China since its establishment 20 years ago, it has been one of the best examples of a German brand branching out in the world’s second-largest economy.
And as Shenyang’s biggest taxpayer for the past 17 years, the automaker has become a favoured darling of the local government. During pandemic lockdowns, when other manufacturing plants were ordered to halt production, the factories of BMW Brilliance and those of its suppliers were on a «white list», allowing them to continue operating. And in Dalian, a port city of Liaoning, containers with parts destined for the automaker are always given the highest priority.
In the past two decades, such close engagement between German carmakers — not just BMW — and Chinese partners and governments has deeply shaped Beijing’s economic relations with Germany and Europe. But now, amid mounting talk in Europe of «de-risking» from China, coupled with the unstoppable rise of Chinese electric-vehicle (EV) makers, the shine may be wearing off.
EU chamber in China lays out ideas to spur growth, hits at self-reliance push
«The economic interest used to have a stronger say in the German government. Many economic policies were influenced by the industry and big companies,» said Harald Kumpfert, former vice-chairman at the Shenyang branch of the European Union (EU) Chamber of Commerce in China.
