June 11 (Bloomberg) -- China’s exports fell by a record as the global recession cut demand for goods produced by the world’s third-largest economy.
Overseas sales dropped 26.4 percent in May from a year earlier, the customs bureau said in a statement on its Web site today. That compares with the median estimate for a decline of 23 percent in a Bloomberg News survey of 15 economists, and a 22.6 percent contraction in April.
“Exports may be at the bottom,” said Wang Qian, a Hong Kong-based economist at JPMorgan Chase & Co. “A sustained recovery is unlikely until demand from major economies picks up around the middle of this year.”
China, the world’s second-biggest exporter, has cut taxes, boosted lending and pledged to keep its currency stable to sustain overseas sales amid the worst global slump since the Great Depression. The economy grew at the slowest pace in almost a decade last quarter as tumbling orders forced manufacturers to shut factories and fire workers.
The decline was the biggest since Bloomberg data began in 1995.
“The worst time for exports is probably over and the improving trend will be more visible starting from June,” according to Xing Ziqiang, a Beijing-based economist at China International Capital Corp. who said a holiday may have amplified the slump in shipments in May. “The recovery will be gradual and slow.”
The government said this month that a quick rebound in trade is becoming less likely and unveiled higher export rebates on some steel products, electronics, machinery and toys, the seventh increase since August.
‘Grim’ Conditions
China still faces “grim” job conditions with registered unemployment climbing and new jobs shrinking compared with a year earlier, the State Council said last week. TCL Corp., China’s biggest maker of consumer electronics, posted a 97 percent plunge in first-quarter profit as exports of televisions and mobile phones fell.
Still, China’s export orders index advanced to 50.1 in May, marking the first expansion in 11 months, a government-backed manufacturing index showed. Japan’s exports and production rose in April from the previous month, and orders placed at U.S. factories gained for the second time in three months.
China’s imports dropped 25.2 percent last month, compared with the 22 percent decline estimated by economists and a 23 percent fall in April. The trade surplus was $13.4 billion in May, smaller than the $14.9 billion estimated by economists in the Bloomberg survey.
China was ranked the world’s biggest exporter after Germany by the World Trade Organization in 2008.
