China‘s export growth slumped in April to its lowest level in almost two years, customs data showed Monday, as a Covid resurgence shuttered factories, sparked transport curbs and caused congestion at key ports.
The data shows the extent of growing damage to the world’s second largest economy as millions are confined to their homes particularly in key business hub Shanghai to stamp out its worst Covid resurgence since the early days of the pandemic.
Beijing has persisted with a strict zero-Covid policy involving lockdowns and mass testing, but the economic costs are mounting as manufacturing hubs and supply chains atrophy under gruelling restrictions.
Export growth plunged to 3.9 percent on-year last month, the Customs Administration said Monday. While this was above analysts’ expectations of 2.7 per cent growth according to a Bloomberg poll, it marked the lowest rate since June 2020. Last month, China’s trade surplus came in at $51.1 billion, according to official data.
In April, China’s biggest city Shanghai was almost entirely sealed off as it became the epicentre of the country’s worst coronavirus surge, with many factories halting production and trucker shortage causing goods to pile up at its port. Restrictions also appear to be looming in other cities, including the capital Beijing.
“Lockdowns in large cities like Shanghai and rising input costs are major reasons” behind the underwhelming trade figures, analyst Zhaopeng Xing of ANZ Research said.
While top leaders have offered words of reassurance for tech, infrastructure and jobs, experts warn that Beijing’s unswerving adherence to its zero-Covid strategy will continue to hack into growth.
Source: eNCA
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