Chinese Imports and Exports Soar in January

HONG KONG — January trade data from China on Friday showed a surge in exports and imports from a year earlier — a phenomenon that was largely due to the timing of the Lunar New Year holiday, but that also supported the view that the Chinese economy is firming.

Economic data from China are often severely distorted by the holiday, the highlight of the Chinese calendar, when many factories shut down for a week or more.

The holiday this year takes place in February — the first day of the Lunar New Year is on Sunday — but last year it fell squarely in January, cutting down on the number of working days during that month.

The trade data released Friday reflected this with a large increase compared with the year before, as analysts had expected. Exports climbed 25 percent from January 2012, according to the General Administration of Customs, and imports soared 28.8 percent.

Both figures beating expectations by a wide margin, however, supported the view that the rise was also caused in part by healthier domestic and overseas demand.

“This strong export number cannot be fully explained by the Chinese New Year effect alone,” Zhiwei Zhang, chief China economist at Nomura in Hong Kong, said in a research note.

“These data suggest that external and domestic demand are both strong, which supports our view that the economy is on track for a cyclical recovery” in the first half of this year, he added.

Dariusz Kowalcyk, an economist at Crédit Agricole in Hong Kong, said “we need to wait for February results to have the full picture of trade at the start of 2013.”

However, he added, “one trend is clear: exports have been doing very well recently. This may be a sign of improved external demand, but is also a testimony to the resilience of Chinese exporters and to their competitiveness.”

The Chinese economy has been accelerating gradually in the past few months, reversing a marked slowdown that had raised fears of a possible “hard landing” in China early last year.

Improved overseas demand, combined with a string of government-mandated stimulus measures, have gradually propped up growth and dispelled those fears.

Data released last month showed the Chinese economy expanded just 7.8 percent last year — down from 9.3 percent in 2011 and 10.4 percent in 2010 — but many analysts expect slightly faster growth again in 2013.

Article source: http://www.nytimes.com/2013/02/09/business/global/chinese-imports-and-exports-soar-in-january.html?partner=rss&emc=rss