China exports continue to plunge
Export trade falls at fastest rate in a decade, threatening more job losses.
“The pressures on employment will be huge.”
China’s imports also slowed dramatically in January, falling 43.1 per cent over a year earlier.
Up to half of China’s $1trn in annual imports involve materials used in goods that are then re-exported.
That fall in imports could also be a blow for China’s trading partners, especially neighbouring Asian economies that rely on China’s manufacturing industries as a major customer for their exports of industrial components and raw materials.
Jobs lost
Dwindling demand for Chinese exports as a result of the global slowdown has hit China’s once-booming export industries hard.
 |
| Factory closures have thrown thousands of Chinese out of work [EPA] |
Thousands of factories have closed or laid off workers, and according to the government at least 20 million migrant workers have lost their jobs as a direct result of the slowdown.
The rising number of jobless is a particular worry for China’s communist rulers who have tied their legitimacy to being able to deliver continued economic growth and raise millions rural poor out of poverty.
They fear that outbreaks of unrest could escalate and threaten their continued grip on power.
Last month Wen Jiabao, the Chinese premier, told delegates at the World Economic Forum in Davos warned that the global downturn had had a “big impact” on his country, which could trigger outbreaks of unrest.
“We are facing severe challenges in China, including shrinking global demand, overcapacity in some sectors, and rising unemployment in urban areas,” he said.
However, he said he was optimistic that China’s economy would still grow by eight per cent this year.
“We have the confidence, conditions, and ability to maintain steady and fast economic growth and continue to contribute to world economic growth,” Wen said.
The Chinese government has already announced a package of stimulus measures totalling some $586bn, as well as introducing a raft of other measures to help struggling exporters of textiles and other goods.