BEIJING — China maintains its competitive edge despite signs of weak exports, HSBC said in a note on June 3.
Exports are lackluster, especially compared with their heady pace in the mid-2000s, but that is due to weak global demand and not because the Chinese mainland has lost its edge, it said.
“In fact, last year, China once again raised its share in global exports - and at double the usual pace,” it said.
China’s real effective exchange rate has appreciated since about 2006, and roughly 30 percent since 2010 alone, leading some to assume China has become less competitive over time, it said.
However, China’s growing share of global exports has increased by 40 percent from its share in 2010, indicating the country’s economy has not lost its competitive edge, it said.
Exports in yuan-denominated terms rose 4.1 percent year on year in April, while imports dipped 5.7 percent, official data showed on May 8.
Export growth in April was milder than the 18.7-percent increase in March, while imports fell at a faster pace compared with a 1.7-percent drop in the previous month.