China’s economic outlook remains positive, based on analysis in the Global Trade Barometer released on January 31 (Wednesday) by DHL, the world’s leading logistics company, despite the country receiving the lowest growth index of the world’s seven largest economies.
The first ever DHL Global Trade Barometer, an early indicator of global trade developments calculated using Artificial Intelligence, Big Data and predictive analytics, suggests that Chinese exports – particularly those of consumer goods, machinery parts, chemicals and products – will bolster the country’s near-term growth, underpinning sustained increases in air freight volumes out of China. However, the Barometer also found that Chinese ocean trade is losing momentum, largely due to the country’s reduced appetite for industrial raw materials.
“With China’s economy shifting towards a more consumption- and service-driven model, it’s no surprise that the growth outlook for ocean freight is significantly lower than before,” said Kelvin Leung, CEO, DHL Global Forwarding Asia Pacific. “The Barometer’s results also suggest that China’s push to raise higher-quality global exports and domestic consumer spending are having the desired effect on trade and future economic development, with core industries like automotive and industrial manufacturing continuing to hold strong.”
According to the Barometer, the decline in ocean freight has been offset by resilient exports in China’s main industries: household goods, automotive and machinery parts. The country’s growth indices for household goods and chemical products also remain strong, though a decline in consumer fashion products is expected to continue weighing down Chinese air exports in the next three months.
“Despite the slowdown in infrastructure spending, China’s consumer and industrial exports remain strong, signalling the success of the country’s greater focus on economic development over raw growth,” said Kelvin. “Businesses can expect to see growing opportunities to source high-quality manufacturing and materials from China, and they should take steps to secure sufficient air freight capacity – or take advantage of declining ocean trade by moving less time-sensitive cargos into containerized shipping – as competition increases.”
Developed jointly by DHL and Accenture, the DHL Global Trade Barometer provides a quarterly outlook on future trade, taking into consideration the import and export data of seven large economies: China, South Korea, Germany, India, Japan, the United Kingdom and the United States. Together, these countries account for 75 per cent of world trade, making their aggregated data an effective bellwether for near-term predictions on global trade. The Barometer, which assesses commodities that serve as the basis for further industrial production, predicts that global trade will continue to grow in the next three months, despite slight losses in momentum.
