China Exports Rise to $237.6bn Value in July
Chinese trade was severely hit after the coronavirus outbreak as the authorities locked down major cities to slow the virus spread. However, with more and more countries lifting COVID-19 restrictions, China exports have witnessed unexpected growth rates in the last few months.
According to data presented by Buy Share China exports hit $237.6bn value in July, a 7.2% jump year-on-year.
Record Shipments of Medical Supplies and Surge in Demand for Electronic Products
China’s economic development has largely profited from its export-led growth strategy. In 2013, the country overtook the United States as the world’s largest trading nation, with more than $2.2trn export value of goods that year, revealed the World Trade Organization data.
The increasing trend continued in the next twelve months, with the combined value of exported goods jumping over $2.3trn by the end of 2014. In 2016, China exports plunged 25%, falling to $2.09trn, the sharpest drop since the 2008 financial crisis. However, during the next year, the export demand recovered, reaching over $2.2trn value. Statistics show the total export value continued rising, reaching over $2.4trn in 2018, a 10% jump year-on-year.
The World Trade data showed that in 2019, China exported nearly $2.5trn worth of goods. However, this was only a 0.5% increase year-on-year, mostly due to the sharp fall in sales in the US market amid ongoing trade tensions. Nevertheless, the US and the EU remained China’s most significant export partners, with a 17% market share each. Hong Kong ranked as the third-largest destination for China’s shipments with an 11% share. Statistics also showed automatic data processing machines, textiles and mobile phones were among China’s top export goods last year.
In January 2020, the total value of monthly exports from China hit nearly $292.5bn value, revealed the China Customs data. However, due to the coronavirus lockdown, this figure stumbled to $185.1bn in March, almost a 37% plunge in two months.
With the global demand improving and more countries lifting COVID-19 related restrictions, China exports recovered to $206.8bn in May. The increasing trend continued by the end of July, with the combined value of monthly exports rising to $237.6bn, a $37.4bn increase in two months.
The country’s exports have been boosted by record shipments of medical supplies and surge in demand for electronic products. Statistics show that in July, exports to Australia jumped 15.8%. The ASEAN countries and the United States followed with 14.1% and 12.1% increase, respectively. However, sales to Japan fell 2% last month.
China’s Monthly Trade Surplus Jumped to $62.3bn in July
As the world’s largest importer, China has witnessed a surge in the import demand in the first two months of 2020, with the combined value of imported goods rising to almost $300bn, a $108bn jump since December 2019. However, statistics show this figure dropped by 44% in the next 30 days, falling to $165.2bn in March. In July, the total value of imports to China amounted to around $175.3bn, a 0.6% increase year-on-year.
The China Customs data show the monthly trade surplus, as a major growth factor for an economy, also recovered after a sharp fall in the first two months of the year. In early 2020, China reported a monthly trade deficit of $7.1bn, the first time since March 2018.
However, statistics show that in March, the monthly trade balance of goods recovered to $19.9bn, and continued rising ever since. In July, the trade surplus in China amounted to $62.3bn, a 41% increase year-on-year.
Communities in Delta State Shut OML30 Operates by Heritage Energy Operational Services Ltd
The OML30 operated by Heritage Energy Operational Services Limited in Delta State has been shut down by the host communities for failing to meet its obligations to the 112 host communities.
The host communities, led by its Management Committee/President Generals, had accused the company of gross indifference and failure in its obligations to the host communities despite several meetings and calls to ensure a peaceful resolution.
The station with a production capacity of 80,000 barrels per day and eight flow stations operates within the Ughelli area of Delta State.
The host communities specifically accused HEOSL of failure to pay the GMOU fund for the last two years despite mediation by the Delta State Government on May 18, 2020.
Also, the host communities accused HEOSL of ‘total stoppage of scholarship award and payment to host communities since 2016’.
The Chairman, Dr Harrison Oboghor and Secretary, Mr Ibuje Joseph that led the OML30 host communities explained to journalists on Monday that the host communities had resolved not to backpedal until all their demands were met.
Crude Oil Recovers from 4 Percent Decline as Joe Biden Wins
Oil Prices Recover from 4 Percent Decline as Joe Biden Wins
Crude oil prices rose with other financial markets on Monday following a 4 percent decline on Friday.
This was after Joe Biden, the former Vice-President and now the President-elect won the race to the White House.
Global benchmark oil, Brent crude oil, gained $1.06 or 2.7 percent to $40.51 per barrel on Monday while the U.S West Texas Intermediate crude oil gained $1.07 or 2.9 percent to $38.21 per barrel.
On Friday, Brent crude oil declined by 4 percent as global uncertainty surged amid unclear US election and a series of negative comments from President Trump. However, on Saturday when it became clear that Joe Biden has won, global financial markets rebounded in anticipation of additional stimulus given Biden’s position on economic growth and recovery.
“Trading this morning has a risk-on flavor, reflecting increasing confidence that Joe Biden will occupy the White House, but the Republican Party will retain control of the Senate,” Michael McCarthy, chief market strategist at CMC Markets in Sydney.
“The outcome is ideal from a market point of view. Neither party controls the Congress, so both trade wars and higher taxes are largely off the agenda.”
The president-elect and his team are now working on mitigating the risk of COVID-19, grow the world’s largest economy by protecting small businesses and the middle class that is the backbone of the American economy.
“There will be some repercussions further down the road,” said OCBC’s economist Howie Lee, raising the possibility of lockdowns in the United States under Biden.
“Either you’re crimping energy demand or consumption behavior.”
Nigeria, Other OPEC Members Oil Revenue to Hit 18 Year Low in 2020
Revenue of OPEC Members to Drop to 18 Year Low in 2020
The United States Energy Information Administration (EIA) has predicted that the oil revenue of members of the Organisation of the Petroleum Exporting Countries (OPEC) will decline to 18-year low in 2020.
EIA said their combined oil export revenue will plunge to its lowest level since 2002. It proceeded to put a value to the projection by saying members of the oil cartel would earn around $323 billion in net oil export in 2020.
“If realised, this forecast revenue would be the lowest in 18 years. Lower crude oil prices and lower export volumes drive this expected decrease in export revenues,” it said.
The oil expert based its projection on weak global oil demand and low oil prices because of COVID-19.
It said this coupled with production cuts by OPEC members in recent months will impact net revenue of the cartel in 2020.
It said, “OPEC earned an estimated $595bn in net oil export revenues in 2019, less than half of the estimated record high of $1.2tn, which was earned in 2012.
“Continued declines in revenue in 2020 could be detrimental to member countries’ fiscal budgets, which rely heavily on revenues from oil sales to import goods, fund social programmes, and support public services.”
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