Photo Credit: Reuters/China Mail
China has reported its first set of trade figures since saying it will crack down on exporters masking hot money inflows as trade payments. Such a bright picture of global demand do April’s figures paint — exports up 14.7% year-on-year; imports up 16.8% on the same basis; and a trade surplus of $18.2 billion — that they are as hard to believe as March’s, which triggered the crackdown in the first place.
Certainly the figures from last month stick out like a sore thumb compared to some other indicators: April’s purchasing managers’ indexes showed Chinese manufacturers’ new export orders shrinking; South Korea and Taiwan’s April trade figures were weak. All of which are more consistent with a view that the global economy is going through a soft patch, not expanding vigorously as China’s April trade numbers would imply.
The measures intended to stop exporters cooking their books don’t come into effect until the end of June. Until then no conclusions should be drawn from China’s monthly trade data about the state of the country’s economy — and the world’s.
