There are two major changes, the export data for May | year-on-year | data

China's foreign trade data for May is released today. There are two notable changes behind this transcript.

Has China's foreign trade competitiveness weakened?

In May, China's total import and export value only increased by 0.5% year-on-year, a significant decrease from 8.9% in April, and exports decreased by 0.8% compared to the same period last year.

The sharp decline in foreign trade growth rate is related to the higher base in the same period last year. Last May, China's import and export growth rate reached 9.6%.

The international market is also one of the reasons for the sudden warmth and coldness. Although the World Trade Organization recently released the "Barometer of Goods Trade" report, which raised the global goods trade prosperity index, suggesting that the global goods trade situation may improve in the second quarter, according to data from South Korea, which is known as the "canary" of the global economy, global trade is still difficult to be optimistic at present.

According to official statistics, South Korean exports decreased by 15.2% year-on-year in May, while imports decreased by 14%. This reflects that under the influence of factors such as high inflation levels and the prolonged escalation of the Ukraine crisis, the global economic recovery is still faltering, and trade growth is therefore being dragged down.

Considering the global economic and trade situation, China's current foreign trade performance is already stable.

On the one hand, the export of key markets and advantageous products remains resilient. In the first five months, China's exports to its largest trading partner ASEAN increased by 16.4% year-on-year, and its exports to its second largest trading partner EU increased by 2.4% year-on-year, both significantly higher than the overall level of China's exports during the same period.

According to official data, China's automobile exports in the first five months amounted to 266.78 billion yuan, a year-on-year increase of 124.1%; The export of labor-intensive products reached 1.65 trillion yuan, a year-on-year increase of 5.4%. Electric passenger vehicles, lithium batteries, solar cells and other "new three types" are becoming important support for China's exports.

On the other hand, imports have steadily increased. In the first five months, China's imports increased by 0.5% year-on-year, and in May, imports increased by 2.3% year-on-year. This indicates that with the accelerated recovery of the domestic economy, imports are also steadily expanding.

Some analyses also point out that the high growth of China's foreign trade in April is not the norm, and measuring the performance of foreign trade in May based on April data may be biased.

Citigroup's Chief Economist for Greater China, Yu Xiangrong, stated that there were many one-time factors behind the high growth of China's imports and exports in April, such as some orders not being delivered in the second half of last year due to the impact of the epidemic; After this year's Spring Festival, there has been a "rush to work" effect and so on.

According to Gao Lingyun, a researcher at the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, considering the gradual release of official policies to stabilize foreign trade, China's foreign trade is expected to achieve a 2% growth in US dollars this year, which is already a good achievement.

What is the situation with further shrinkage of Sino US trade?

According to Chinese statistics, the total trade value between China and the United States increased by 3.7% year-on-year in 2022. But in the first five months of this year, the total value of trade between China and the United States decreased by 5.5% year-on-year, further expanding compared to the first four months. Among them, China's exports to the United States amounted to 1.38 trillion yuan, a decrease of 8.5%; Importing 508.29 billion yuan from the United States, an increase of 3.9%; The trade surplus with the United States reached 87.057 billion yuan, narrowing by 14.5%.

Analysts believe that despite a decrease in trade volume, the economic and trade relations between China and the United States are still closely linked.

From the recent intensive visits of executives from multiple American companies, such as Musk, to China, it is evident that the notion of decoupling is unpopular.

In the words of former Chief Economist of the Office of the United States Trade Representative, Graser, although the US tariff policy on China has an impact on bilateral trade, the actions of consumers and businesses have more influence than political decisions.

In fact, the healthy development of China US economic and trade relations has always been a common expectation of business people.

Craig Allen, President of the National Committee on US China Trade, recently stated that there is competition in the US China bilateral relationship, but there are also more reasons for cooperation. "We should do our best to ensure that both countries move forward on the path of not overly focusing on competition and facing the interests of cooperation."

He stated that a healthy and balanced US China economic and trade relationship is in line with the interests of both sides, and both companies and consumers benefit from it.

Hua Ganglin, Chairman of the American Chamber of Commerce in China, also said that trade between the United States and China has benefited the United States a lot, and the economic and trade between the two countries are highly integrated. A sudden impact will have "catastrophic consequences" for both the United States, China, and the world.