China trade growth accelerates beating forecasts

ddChina’s trade growth accelerated in April, beating analyst expectations, a positive sign for the country’s fragile economic recovery.

Exports surged by 14.7% compared with a year earlier. That is up from 10% in March. Imports also rose by 16.8% up from 14.1%.

The data meant a trade surplus for China, reversing a surprise deficit in March.

However, some analysts raised questions about the accuracy of the data.

“I have no strong conviction whether the data reflect reality,” said Zhiwei Zhang, chief China economist at Nomura in Hong Kong.

China had a bigger-than-expected trade surplus in April of $18.2bn, after a surprise deficit of $884m in March.

 

 ‘Crack down’

In recent months Chinese export data has shown positive signs of a gradual recovery in external demand.

But that is not in line with other Asian exporter countries, such as South Korea and Taiwan, which have seen their export growth weaken amid slowing global demand.

Some analysts said they suspected that some Chinese exporters may be overstating their business to avoid capital restrictions on funds they are bringing into the country.

China, which keeps a tight grip on capital flows in and out of country, has announced fresh moves to control any illegal flows.

On Sunday, the State Administration of Foreign Exchange (SAFE), China foreign exchange regulator, said it would increase its scrutiny of export invoices and impose tougher penalties on firms providing false data.

Analysts said the move indicated that the practice had become a concern for them.

“China’s SAFE recently launched new rules to crack down against capital inflows disguised as trade payments. I’m suspicious about the trade data,” said Mr Zhang.

 

Delayed recovery?

Chins has been trying to boost its economy, after the recent slowdown in its growth rate.

The world’s second-largest economy saw its annual growth rate slow to 7.7% in the January to March quarter, compared with 7.9% in the last three months of 2012.

However, analysts said that while there had been some signs of a recovery, it continues to remain a fragile one.

They pointed out to the purchasing managers’ index (PMI) survey released last week, which showed that growth in China’s huge factory sector slowed in April as new export orders shrank.

At the same time there have been doubts that growth numbers in the first quarter may have been inflated by the over-invoicing by exporters.

Some analysts said the data over the next few months will be a more accurate indicator of China’s trade growth, and the overall health of its economy.

“With Beijing tightening checks on hot money inflows disguised as trade transactions, I think the export figures in the coming months will more reflect the real underlying momentum of external demand,” said Shen Lan, an economist with Standard Chartered Bank in Shanghai.

 

Source : BBC News

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About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. thomas@novaadvisors.com In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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