Game over : China exports crashed by 17,5 % in january

Again, China was the missing piece… Amid a dramatic, and global trend, China was resisting better… In december, exports decreased by only 2,8 %, while all other asian exporters were crunched (read here)… and Thailand too.

But this resistance seems to be short-lived.

China’s exports fell by the most in almost 13 years as demand dried up in the U.S. and Europe, worsening the outlook for jobs and industrial production in the world’s third-biggest economy.

Shipments declined 17.5 percent in January from a year earlier, the customs bureau said on its Web site today, after falling 2.8 percent in December. […]

Imports declined 43.1 percent in January from a year earlier, the biggest decline since Bloomberg data began in 1995, on the nation’s waning demand for raw materials for manufacturing and lower commodity prices. The trade surplus was $39.11 billion, the second-highest on record. (Bloomberg)

What about january ? We had a first glimpse with the data of South Korea (-32,8 % for exports ! read here)… But with the results from China, it’s now a certainty : the month is going to be ugly. For all.

And the drop of thai exports is going to intensify. China is a major trade partner for Thailand (chart here).

No escape. No miraculous “stimulus” effect. No Abhisit-dressed-like-the-Virgin-Mary gospel. No effects from the inane economic policies of his government (a mere delaying effect maybe).

We are in deep shit.

14 Responses to “Game over : China exports crashed by 17,5 % in january”

  1. 1 World Citizen 11 February 2009 at 4:20 pm

    And if the global financial collapse wasn’t freighting enough then the linked article “Catastrophic Fall in 2009 Global Food Production,” will be.

  2. 2 World Citizen 11 February 2009 at 4:44 pm

    More unwanted records:

    “For the airline industry, the worst thing about the worst monthly decline ever in air cargo traffic in December may be what it says about the coming year.”
    (Couple of nice charts TC)



  3. 3 ThaiCrisis 11 February 2009 at 4:58 pm

    Indeed, a scary but very interesting article, with lot of details.

    His case against deflation makes sense. But actually, the reality could be worse :
    -reduction of assets prices (property, stocks etc.)
    -and increase of food prices

    Both… in the same time.

  4. 4 World Citizen 11 February 2009 at 5:13 pm

    TC: “But actually, the reality could be worse :
    -reduction of assets prices (property, stocks etc.)
    -and increase of food prices”

    Reduction of assets prices and increasing food prices IS the reality!

  5. 5 World Citizen 11 February 2009 at 5:17 pm


    A must see video:

    At 2 minutes, 20 seconds into this video clip, Rep. Paul Kanjorski of Pennsylvania explains how the Federal Reserve told Congress members about a “tremendous draw-down of money market accounts in the U.S., to the tune of $550 billion dollars.” According to Kanjorski, this electronic transfer occurred over the period of an hour and threatened a further $5 trillion to be drawn out triggering a total collapse of the Financial System, which prompted Hank Paulson’s emergency $700 billion TARP bailout action

  6. 6 World Citizen 11 February 2009 at 5:50 pm

    On China:

    The fact that imports are falling even faster than exports strongly suggests that processing exports will tank further in the coming months. Not a good sign for Thailand and, worse, there is no bottom in sight.

    Bankruptcies, unemployment and social unrest are spreading more widely in China than officially reported, according to independent research that paints an ominous picture for the world economy.

    The research was conducted for The Sunday Times over the last two months in three provinces vital to Chinese trade – Guangdong, Zhejiang and Jiangsu. It found that the global economic crisis has scythed through exports and set off dozens of protests that are never mentioned by the state media.

  7. 7 chinesethai 12 February 2009 at 8:45 am

    Widespread social unrest in China? WoW, so scary!

    It has become a tradition for most western media to add the popular clause “increasing the risk of widespread unrests in China” after the report.

    Have you ever been to China? And where?

    Social structure and culture in the west are not the same as in the Orient. I found it amusing everytime the West is trying desperately to apply the “Class Struggle” Theory to East Asia (Thailand, China, etc.).

    If western style “class struggle” is real in Asia, India, in which the medieval caste system still exists and more serious than in Thai and Chinese societies, could have broken apart.

  8. 8 ray 12 February 2009 at 10:34 am

    i think the wide spread social unrest will be happening more in the western countries. why? because people in west are not used to strugging. they are used to charging everything on the credit card. lets not forget that most developed countries import most of the neccecities food water etc. right now banks are cutting credit card limits and people are losing their jobs. they depend too much on the government.
    in difficut times asian countries are much more resilient. thai,indian,chinese,japs,korean. they will sacrifice and buckle down but is the west i dont think so. this is not to say that things will be easier in asia but atleast food is much affordable than in the west.

  9. 9 olivier 12 February 2009 at 1:57 pm

    well, the agricultural commodities don’t increase but falling. Source :

    Please, be unbiased 🙂

  10. 10 ThaiCrisis 12 February 2009 at 2:08 pm

    Well, let me “introduce” myself into the dispute. 😉

    Agricultural prices are going down… but are still higher than 1 year ago.

    To show my point :

    And we were saying that prices could go up again in the near future.

  11. 11 World Citizen 12 February 2009 at 4:29 pm

    Rising worldwide food inflation is surprising and puzzling economists. They don’t understand why it is happening (they didn’t see the credit crisis or the bursting commodity bubble coming either!).

    In addition to TC Thailand Agricultural data, sample worldwide (India / Russia / South Africa / Northern Ireland / Canada) food inflation links were provided in Feb 1st Blog: “Finance Minister: “Govt has money to pay salaries”… really?”

    Thus, it appears that despite the economic crisis and widespread deflation fears, world food prices are rising which, calls to question the conventional wisdom that inflation is not a problem.

    There is a misguided notion that lower demand, lower commodity costs, and deflation will lead to lower prices. This is false:
    1) Falling demand only lowers prices when producers have room to cut prices. If businesses have no profit margin with which to absorb lower prices, then falling demand, instead of lowering prices, lowers the supply of goods by forcing companies into bankruptcy. As companies go out of business, the supply of goods is reduced and surviving competitors have room to raise prices.
    2) Companies didn’t raise prices enough in 2008 to compensate for rising manufacturing costs. While the commodity bubble was exploding, companies held back on price increases to avoid losing customers. Now they must pass on last year’s increased costs to stay in business.
    3) Deflation fears are forcing up borrowing costs, which like commodity costs, must be passed on to consumers.

  12. 12 ThaiCrisis 12 February 2009 at 4:43 pm

    Very true.

    We could add other factors :
    -for instance, Threshold effects. During good times, we had big volume on product A… Now, during hard times… less volume… therefore transportation costs per unit for product A are soaring… leading to an inflated prices (or that could neutralize a nominal decrease of the product price). We could even see…. shortages.
    At one point, it would make no sense to export the product A, etc.

    The point is : our global and linked modern economy is very difficult to “embrace” by our imperfect human brains… So many secondary effects, so many links and variables, so many relations that are not linear, etc.

  13. 13 World Citizen 12 February 2009 at 5:53 pm


    I am happy to hear you play down the threat of large-scale social unrest in China. Certainly, with your contacts, as implied in previous Blogs, you are in a better position to provide comment that is based on fact rather than supposition.

    The scale of job losses, as large as it may be, is not unprecedented in China; millions of workers lost their jobs when China reformed its state-owned firms between 1998 and 2002.

    Most of the migrant workers do have a family plot of land to fall back to in the rural area even if they don’t relish that idea.

    And yes I have visited China but, unfortunately, not for many years.

  14. 14 olivier 15 February 2009 at 8:06 pm

    First, the price of agricultural commodities increased during many month not because the demand was up but because speculation on the futures market. Second, it’s a fact that real demand slump (people consume less).

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Thailand Crisis

Coup, Economic slowdown, Terror In the South... The situation is worsening in Thailand. Bumpy road like often before.

But this time, it's different.

The key to understand the present turmoil is the inevitable... succession of King Bhumibol.

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