China's trade shrinks in April in worrisome economic sign

China's trade shrank in April in a worrisome sign for official efforts to reverse a slowdown in the world's second-largest economy.

Customs data today showed exports contracted by 1.8 per cent from a year earlier to USD 172.7 billion, falling back into negative territory after March's temporary burst of 11.5 percent growth.

Imports plunged 10.9 per cent to USD 127.2 billion after the previous month's 13.8 per cent contraction.

China's economic growth slowed to a seven-year low of 6.7 per cent in the first quarter of the year.

Manufacturing and other activity have been lackluster despite government stimulus efforts that include a boost in bank lending and an easing of controls on real estate sales.
The growth rate is the country's slowest quarterly growth
 

since the first quarter of 2009.

China's GDP slowed down to 6.9 per cent last year.

The government has fixed this year's target between 6.5 per cent to seven per cent.

Today's data showed that trade with the European Union, China's biggest trade partner, climbed 1.8 per cent year on year in the first seven months, GAC data showed.

In the same period, foreign trade with the United States, China's second-biggest trade partner, fell 4.8 per cent and that with the ASEAN, its third-largest trade partner, declined 2.2 per cent, Xinhua reported.

Meanwhile, global ratings agency Fitch said in a report on the outlook for China's volatile real estate sector that housing demand in China will remain relatively resilient up to 2030 while short-term market volatility will persist.

China needs to build 800 million square meters of residential property space - about the size of Singapore - every year between 2016 and 2030 to meet demand, the Fitch report said.

During this period, new housing supply is predicted to average around 750 million square meters per year, down 25 per cent from the agency's previous estimates, while new home sales are seen to track similar levels.

Though the volume of new homes to be sold and completed in the country will fall, the magnitude of the decline is likely to be modest on an annualised basis, the report said.

China's housing market had cooled for more than a year before starting to recover in the second half of 2015, boosted by government support, which included interest rate cuts and lower deposit requirements.

The sector's recovery, however, has been uneven from city to city, with economically-strong areas reporting drastic price rises, and less developed areas still reporting huge inventories of unsold houses.