[Mainland China reporting]We have all no doubt have seen the bad news that China’s exports to the EU have reduced, China’s experts to the US are declining rapidly and, as a result of it, we’re being told by Western media that China is on the verge of collapse
Well, here’s a statement that was released just a few days ago by the State Council: “China’s foreign trade in goods up by 8.7% in January and February. Exports from China grew 10.3% and imports by 6.7% over the first 2 months of last year” – and remember, the first two months of last year were already high, because of the opening after Covid restrictions.
Here’s what the World bank said about the same figures: US imports from China are being replaced with imports from large developing countries with revealed comparative advantages in a product. Countries replacing China tend to be deeply integrated into China’s supply chains and are experiencing faster import growth from China, especially in strategic industries. Put differently, to displace China on the export side, countries must embrace China’s supply Chains”.
Simply put, this means the global economy is now changing – for most of China’s modern economic growth history, that is, since open and reform and certainly since the accession to the World Trade Organisation, the largest markets for China were the developed nations such as the USA which reduced this year by -7%, The European Union, another reduction of 6.8% and Japan which fell 2.5%.
Much of the EU and Japan, as well as the UK are experiencing downturns in their economies and that includes what they can (or can’t) afford to buy from China. The US reports slight growth in its economy but has two problems, one is the increasing number of people falling out of the middle classes into low income and even poverty, they can no longer afford to buy items they want; the other is the restrictions the US have imposed upon themselves to prevent them buying directly from China which create uncertainty for market stability. Nowhere is this more obvious than the trade figures with Mexico. The Asia Times points this out with a stunning graph, clearly showing that China’s increases in exports to Mexico, almost perfectly align with Mexico’s exports to the USA.
