Communist China’s Exports Declined Sharply in August Under Zero-covid Policy

Communist China’s export growth slowed sharply in August based on Customs data due to the zero-Covid policy, media reported on September 8th.

The total amount of export reached $314.9 billion in August, a 7.1 percent increase from a year earlier, setting the lowest growth record since April. The result is lower than the previous forecast of 12.5% and also lower than the 18% year-on-year growth rate in July.

Consumer enthusiasm and business confidence were severely hit, and factory activity decreased throughout August, as a result of zero-Covid policies across communist China, as well as high temperatures and dry weather. Although local governments have introduced a series of measures to boost the economy, it is widely believed that the economy is unlikely to show signs of recovery until the zero-Covid policy is completely lifted.

The demand of U.S. and Western European households to import goods from Communist China has been declining as energy prices rise and monetary policy tightens, said Rajiv Biswas, the APAC chief economist at S&P Global Market Intelligence.

Analysts at Nomura cut their 2022 economic growth forecast for Communist China to 2.7 percent from 2.8 percent earlier due to the continuous tightening of the zero-Covid policy. Communist China’s export growth is likely to remain in the single digits for the rest of the year, said Zhang Zhiwei (张志伟), chief economist at Pinpoint Asset Management.