Southeast Asia Rescues Chinese Exports: US in Decline

China’s trade relations with the United States have plummeted, but recent export data suggests that China is far from being down and out. Instead, it is Southeast Asian countries that are now keeping the export wheels turning with record increases in demand for Chinese goods.

US Closes Its Doors

In April, China’s exports to the US dropped by more than 21%, while imports from the US fell nearly 14%. The blame is largely attributed to new tariffs that have made it expensive, and in some cases impractical, to conduct trade between the two economic powerhouses.

ASEAN Becomes the Saviour

Meanwhile, exports to ASEAN countries grew by 20.8%, significantly above the growth seen in March. Vietnam and Malaysia remain key destinations, but Indonesia and Thailand are notably increasing, with rises of 37% and 28% respectively.

A Fragile Recovery

Although the overall export figures showed an 8.1% increase in April, storm clouds loom on the horizon. Factory activity is declining, and new export orders are on the downturn. Concerns about mass layoffs are rising, prompting the authorities to introduce economic stimulus measures to keep the economy moving.

As China takes a breath in the south, its relationship with the US is put on hold. Yet, the question remains, how long can the southern breeze sustain this momentum?

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