Effects of the trade war, decline of Chinese imports

HONG KONG, KOMPAS.com – China's imports would have declined in May 2019. Surprisingly, the increase in exports has unfortunately not been able to dispel the fears that the United States' trade war with China is only heat and destroy more and more the global economy.

Report of BloombergMonday (6/10/2019), according to the report of the Customs and Excise Agency, China's imports fell by 8.5% in May 2019 compared to the same period of the year before. At the same time, exports increased by 1.1% and shipments to the United States collapsed for two consecutive months.

The decline in imports confirms the weakening of the Chinese domestic economy, while an increase in exports would only be temporary. Indeed, the increase in exports was mainly due to manufacturing shipments made before the threat of new tariffs from the United States.

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The weakening of Chinese imports worries the global economy.

"We expect export growth to remain positive in June 2019, likely supported by earlier shipments of Chinese products to the US (before the imposition of new tariffs)." Beijing should take stimulus to stabilize markets and growth, "said Lu Ting, Chief Economist Nomura Holdings Inc.

Imports of a number of products would have declined sharply. The volume of soybean imports fell by 12.2% and imports of steel and copper products declined.

At the same time, imports of petroleum, gas and coal products would increase.

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"Import growth has declined in line with the slowdown in the national economy and the prospect of a worsening of the trade war," said Xia Le, an Asian economist at Banco Bilbao Vizcaya Argentaria SA.

According to Lu, Chinese exports will fall in the third quarter of 2019 when the government of President Donald Trump will apply new tariffs on imports of Chinese goods worth $ 300 billion. US sales representatives began to review the application of 25 percent duty on products from China last month.