BEIJING — China’s trade growth plunged in June, hurt by weak U.S. and European demand and a Chinese slowdown, with a potential impact on economies as far-flung as Africa and Australia.
Import growth fell by half from May’s level to 6.3 percent, data showed Tuesday, as factories facing weak foreign orders cut purchases of raw materials and domestic demand softened despite stimulus efforts.
Export growth declined to 11.3 percent from May’s 15.3 percent.
“The import slowdown was greater than expected,” said Moody’s Analytics economist Alaistair Chan in a report. As for foreign demand, “it is increasingly clear that exports will not be much of a boost to China’s economy for some time.”
Growth in the world’s second-largest economy has tumbled to its lowest level since the 2008 global crisis due to anemic export demand and government efforts to cool overheating and inflation.
That is bad news for companies and investors that were looking to relatively strong Chinese growth to shore up global demand as the U.S. and Europe struggle.
Weaker Chinese demand could hurt Asian suppliers of industrial components and suppliers of iron ore, oil and other commodities such as Australia, Brazil and Africa.
China is the biggest market for South Korea, Australia, Thailand and Malaysia.
“Our expectation is that China will have a soft landing, but were it to be a more severe downturn, it could hit quite hard in Asia,” said Rajiv Biswas, chief Asia economist for IHS Global Insight.
The U.S. and Europe are less directly exposed but would feel an indirect blow as demand for their goods in economies that supply China weakens. China, the world’s biggest energy consumer, is a major importer of oil and gas from as far away as Angola.
China’s economic growth fell to 8.1 percent in the first quarter, and data due out this week are expected to show it fell as low as 7.3 percent in the second quarter. Analysts expect a rebound later this year following two rate cuts since early June.
Premier Wen Jiabao told domestic economists at a conference this week in Beijing that stabilizing China’s economic growth is “an urgent task for the short term and an arduous task for the long term.”
A transcript of his remarks posted to the government’s website Tuesday quoted him as saying that China has been boosting consumption and diversifying exports but stressed the importance of “promoting the reasonable growth of investment.”
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