China’s Exports Slide for Eighth Month

China’s exports fell for an eighth month as the global recession cut demand, highlighting the economy’s dependence on stimulus spending to revive growth.

Overseas sales slid 21.4 percent in June from a year earlier, the customs bureau said today on its Web site, after a record 26.4 percent drop in May.

Imports fell a less-than-estimated 13.2 percent, the smallest decline in eight months, signaling that the worst may almost be over for the nation’s trade. China, the world’s second-biggest exporter, has stalled gains by the yuan against the dollar and increased export-tax rebates as the government’s 4 trillion yuan ($585 billion) stimulus package drives an economic recovery.

Premier Wen Jiabao said the foundations for an economic recovery are not yet solid and pledged to continue a pro-active fiscal policy and moderately loose monetary policy, a statement on the government’s Web site said today.

Exports gained a seasonally adjusted 4.5 percent from May and imports rose 2.2 percent, the customs bureau said.

The trade surplus narrowed to $8.25 billion, the smallest in two years, excluding the first two months of each year, when a Chinese holiday causes distortions. The decrease in imports from a year earlier slowed from a 25.2 percent decline in May. Economists’ median estimate was for a 20.3 percent slide.

A recovery in export demand may be slowed by rising unemployment in the European Union and the U.S., China’s top two overseas markets. U.S. companies have slashed about 6.5 million jobs since the recession began in December 2007, the most of any slump since World War II, and European retail sales fell more than economists forecast in May.

Exports to the U.S. fell 16.9 percent in the first half of 2009 from a year earlier, the customs bureau said. Shipments to the European Union declined 24.5 percent.

China’s Exports Slide for Eighth Month, Bloomberg
7/10/2009 9:43:30 AM