So why the ‘low’ number? It seems export growth has slowed - to 19.4% year-on-year, down from a 29.9% increase in April. Meanwhile imports proved strong, rising 28.4% in May from a year earlier, up from a 21.8% rise the previous month.
Those sums may serve as a soothing tiger balm for some economists, who have long worried that China’s reliance on exports destabilises global growth. While China’s trade surplus hit a record of nearly $300bn in 2008, it has been on the wane since as demand for its products have collapsed under the weight of the global financial crisis. And this latest decline in exports suggest that other markets aren’t picking themselves up as well as people had hoped. Or that the world’s biggest exporter is finally doing something about expanding its domestic market, which would help rebalance the global economy.
The results just prove that even a powerhouse like China is not above the global concerns suffered by everyone else. In fact the state-backed All-China Federation of Industry and Commerce has now warned that, in the wake of the Government’s anti-inflationary measures, China’s all-important small businesses (responsible for 60% of its GDP) are facing a cash squeeze that may be worse than during 2008’s global financial crisis.
This probably won’t go down too well in the offices of Samsonite. Following Prada’s announcement that it’s looking to raise $2.6bn in an IPO on the Hong Kong stock exchange, the well-known maker of ‘indestructable’ luggage has leapt on the same carousel seeking $1.25bn. That may now seem somewhat ambitious.
The company has already suffered the consequences of bad timing – private-equity group CVC picked it up just before the credit crisis caused the travel industry to tank. RBS wound up taking a 30% stake in the luggage brand. Now it’s putting its eggs in the Asian basket, as leisure travel becomes increasingly affordable for people in the East. At least China’s import strength suggests that, despite rising commodity prices, its domestic demand for western-branded goods remains Samson-esque. For now, at least…