China's exports fall for fourth month as growth engine stalls

A downturn in the property sector has pushed imports to their 11th month of declines in the past year

- Stella Yifan Xie

China's exports to the rest of the world dropped for a fourth straight month in August, bringing little relief to the country from a deepening economic malaise and weighing on the global trade outlook.

China has struggled to sustain a wave of overseas demand for Chinese-made goods that carried it through much of the three years of the pandemic, particularly as Western consumers tilted their spending back toward services and away from smartphones, furniture and other goods. Higher borrowing rates in the U.S. and other developed countries also hit consumer appetite.

Meanwhile, Chinese imports continued to shrink in August, a reflection of lackluster consumer demand even after the country loosened its longstanding Covid-related restrictions. A downturn in China's property market has also sapped demand for raw materials used in construction.

Taken together, the sluggish trade data released Thursday by Beijing provides new evidence that the world's second-largest economy is struggling to revive domestic demand.

That would ripple through the global economy as China's slowdown weighs on oil prices and hurts commodity-exporting countries such as Australia, Brazil and Canada. Chinese manufacturers have been under pressure to cut prices to retain market share, potentially sending disinflationary currents around the world.

While Chinese policy makers have trimmed key interest rates and made new attempts to revive home-buying sentiment, economists have widely dismissed these efforts as too piecemeal to revive growth given the speed with which sentiment has soured.

"There's still a steep hill to climb to get the all-clear on stabilization for China," said Frederic Neumann, chief Asia economist at HSBC.