August 8, 2023—China’s trade with the rest of the world fell by 14.5 percent year-on-year in July, according to government data. That was the sharpest drop in imports and exports since early 2020. The decline was more than the 12.5 percent fall predicted by a poll of economists conducted by Reuters.
Exports from the world’s second-largest economy have fallen for three straight months, as the consumer and business appetite for China’s goods in Europe and the United States has fallen.
The decline may reflect weaker demand for China-made products as well as other factors such as shifts in supply chain, high global inflation, and rising interest rates. The largest drops in foreign buying of goods occurred in the computer, steel, and clothing sectors, according to reporting by the Financial Times. Meanwhile, exports of cars, ships, and mobile phones grew.
Foreign investment in China is also on a downward trend, according to reporting from the South China Morning Post, which said FDI ” plunged to a historical low of US$4.9 billion in the first quarter.”
