China’s trade numbers recover faster than expected, but GDP projections are grim

The Wall Street Journal reports that Chinese imports and exports are regaining strength, but “officials and analysts warned of a grim outlook for the world’s largest exporter as global economic activity collapses.” The numbers in March were better than expected:

Outbound shipments from China dropped 6.6% in March from a year earlier, following a 17.2% decline in the January-February period, data from the General Administration of Customs showed Tuesday. The fall was much less steep than the 15.9% decline estimated by economists polled by The Wall Street Journal.

Imports fell 0.9% year over year last month, compared with a 4% decline in the first two months of the year — and a 10% fall predicted by the economists.

Meanwhile, multiple projections of about 2% GDP growth for 2020 — compared with an official 6.1% GDP growth in 2019 — have now been published.

  • The World Trade Organization estimates that China’s real GDP growth will be about 4% less than the 2019 baseline for 2020, even in optimistic scenarios.
  • The median projection of 62 analysts surveyed by Reuters showed 2.5% growth for the year, which would be the weakest year for the Chinese economy since 1976.

Three bright spots:

  • Venture capital is bouncing back, with Chinese startups raising more than $2.5 billion in March, a “sixfold rise from just $410 million in February,” per the Financial Times (paywall).
  • Luxury spending is probably doing well — according to Women’s Wear Daily, one Hermès store in Guangzhou made $2.7 million in one day upon reopening.
  • iPhone shipments in China are up: “Shipments of Apple’s marquee device jumped 19% in March from a year earlier to 2.5 million units,” Bloomberg reports (porous paywall).

More COVID-19 updates from China:

Two more clinical trials for vaccines have been approved to move forward, at the “Wuhan Institute of Biological Products, under state-owned China National Pharmaceutical, and Sinovac Research & Development in Beijing,” according to the SCMP. The announcement “comes just days after another potential vaccine developed by Tianjin-based CanSino Biologics and the Academy of Military Medical Sciences’ Institute of Biotechnology, entered the second phase of human trials.”

University students will be confined to campuses, with an exception given only to staff for the time being, the Ministry of Education said, per the SCMP.

—Lucas Niewenhuis