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China’s Export Situation in the 2nd Half of 2015 and Export Outlook in 2016
2015-12-14
By Zhao Fujun & Zhao Jinping
Research Report Vol.17 No.6, 2015
I. Basic Information of Surveyed Companies
A total of 650 usable questionnaires are returned in this survey. If all are grouped by ownership, private enterprises account for the majority, 88.2% of all companies in the survey; if grouped by scale, small firms with less than 500 employees account for the most, 97.2% of the total; if grouped by export destination, exporters oriented to Europe, other regions, US, other BRICS countries take up 35.7%, 27.8%, 17.8% and 7.5%, respectively; if grouped by industry, enterprises in food, mechanical equipment, mental product industries account for 35.8%, 10.9% and 10.5%, respectively. The survey polls firms in 11 provinces and cities which are representative of the population. If all are grouped by region, firms in Zhejiang Province account for 44.2%, which ranks the top in terms of the number of firms in the survey; firms in Jiangsu Province follow next, accounting for 15.2%.
II. Export Growth of Surveyed Companies from January to October 2015
Based on the survey results and comparison with the results from the surveys in this spring (for the period of Jan to May, 2015) and last fall (for the period of Jan to Oct, 2014), several features in export growth of the surveyed companies for the period of Jan to October, 2015 are as follows.
1. Export growth continues to go down this year with only a few enterprises achieving increase in export
The survey results show that 13% of the firms have export growth from Jan to October this year (including one group with growth rate of 5% to 19%, and another group with over 20% growth, respectively); 36% of the companies maintain basically unchanged growth, while 51% see a decline in exports (including one group with a decline of 5% to 19%, and another with a decline of over 20%).
Compared with the previous two surveys, much more companies report declined exports in this survey than in last fall and this spring, and much fewer report export growth than in last fall and this spring; Similar number of companies report unchanged export growth compared with last fall and this spring. All these numbers indicate export growth continues to go down during the period of January to October, implying a much tougher situation.
2. Small companies face tougher export situation than their medium-sized counterparts
This survey mainly focuses on small and medium-sized companies. The results show 18.8% medium-sized companies see export growth in the period of Jan to October of 2015, which is bit higher than the percentage of small exporters; 31.2% of the medium-sized companies see declined exports, 20.4 percentage points lower than small exporters. These numbers illustrate small enterprises face tougher export situation than their medium-sized counterparts.
Compared with the results from the previous two surveys, much fewer small and medium-sized companies see export growth than those in the surveys of last fall and this spring; much more small and medium-sized companies have declined export than those in the surveys of last fall and this spring; the number of small firms reporting unchanged export is slightly lower than that in last fall and this spring, while the number of medium-sized firms reporting unchanged export growth is much larger than that in last fall and this spring. Overall, the export situation for the small and medium-sized companies in this survey deteriorates, and becomes tougher than that in last year and the first half of this year.
3. Metal and metal product industry face the toughest export situation
This survey shows 4.4% of the companies in metal and metal product industry see export growth, a percentage lower than other industries; 54.4% of the companies in this industry see declined exports, a percentage higher than other industries. These numbers illustrate metal and metal product industry faces a moredifficult export situation.
In this survey, much fewer firms in all industries see export growth than last fall and this spring, and much more firms experience export declines than in last fall and this spring. It can be inferred that the export situation continues to worsen for all industries.
4. Companies exporting to Europe, other BRICS countries and Japan have a relatively greater stress of declined exports
As few companies exporting to ASEAN, China Hong Kong, China Macao, China Taiwan, and Korea are included in this survey, it is hard to draw conclusion for this group of exporters. So, our focus of comparison is on companies exporting to Europe, other BRICS countries, Japan and US. In this survey, 11.6%, 8.1%, and 7.5% of the companies exporting to Europe, other BRICS countries and Japan report respectively that they have an increase in exports, which all are lower than the percentage of firms exporting to the US; 51.7%, 59.2% and 55% firms exporting to Europe, other BRICS countries and Japan report respectively a decrease in exports, all being higher than the percentage of the companies exporting to the US. Compared with the survey results in this spring, fewer firms report export growth in all markets than this spring, while more surveyed companies report declined export growth in all markets than this spring. It can be said companies exporting to all markets face a tougher export situation.
III. Analysis of Export Performance of Surveyed Companies
1. Export prices of the companies in the survey continue to fall
In the period of Jan to October of 2015, 11.4% of the companies see a rise or a sharp rise in the prices of their export products, both being lower than the percentage in last fall and this spring; 56.3% of the firms report stable prices, higher than last fall and this spring; 32.3% of the firms report a price decline, a much higher percentage than in last fall and this spring. It can be said, export prices continue to fall.
2. Profit rate of most companies goes down
As export prices of the exporters fall, their profit rate is directly affected. This survey shows, in the period of Jan to October this year, only 2.8% of the firms report a high profit rate, which is a lower percentage than last fall and this spring; 66.6% of the respondents say they maintain their profit rate at somewhat low andvery low levels, which is a smaller percentage than that in last fall and this spring; 23.7% of the companies report a break-even performance, and 6.9% say they suffer a loss, which are both higher than in last fall and this spring.
IV. Orders of Surveyed Companies and Their Outlook on Export Situation for Year 2016
1. The surveyed companies have fewer orders on a year-on-year basis
This survey shows, 11.8% of the companies report they have a “sharp rise”, a “slight rise” in export orders in the period of Jan to October this year; 53.6% report they have a “slight decline” and a “sharp decline” in export orders. Compared with the results of the surveys in last fall and this spring, much fewer firms report an increase in export orders, and much more report a decrease in export orders, which shows the deteriorating situation of exporters’ orders.
In terms of company size, small firms in this survey that have a rise in orders account for 11.7%, 7.1 percentage points lower than the medium-sized ones; small firms having a decline in orders take up 54.1%, 22.8 percentage points higher than their medium-sized counterparts, which indicates a tougher situation for small firms in the future.
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