BEIJING - China's exports fell 14.6 per cent on-year in March to 886.83 billion yuan (about S$195 billion), the government said Monday, an unexpected drop and a further sign of weakness in the world's second-largest economy.
In a sign of soft domestic demand, imports also fell, declining 12.3 per cent to 868.67 billion yuan on-year, the General Administration of Customs said, while the monthly trade surplus plummeted 62.6 per cent to 18.16 billion yuan.
The export decline was far off what economists had expected, with a survey by Bloomberg News projecting an increase of 8.2 per cent. The poll forecast imports to decrease 11.3 per cent.
China's economy slumped to annual growth of 7.4 per cent in 2014, the weakest result in 24 years and the slowdown appears to have continued into this year as indicators including industrial production, consumer spending and fixed asset investment have slumped.
China expanded grew its trade sector by 3.4 per cent in 2014, according to government data, missing the government's growth target of 7.5 per cent by more than half.
Taking that disappointing outcome into account, the government has lowered its growth target for 2015 combined imports and exports to around 6 per cent.
"The slump in the exports figure is mainly due to the weak global demand, while the appreciation in dollars against other currencies in the past quarter was also negative for China's exports," said Nie Wen, a strategist at Hwabao Trust in Shanghai. "More stimulus measures are needed in the future."
The trade performance left China with a trade surplus of US$3.1 billion last month, much smaller than forecasts for a US$45.4 billion trade gap.
In line with the slowing Chinese economy, China's trade sector has been buffeted by lacklustre foreign and domestic demand in the past year, raising concerns among policymakers.
Chinese vice premier Wang Yang was quoted by Xinhua state news agency as saying earlier this month that authorities must act to arrest China's export slowdown lest it further dampens economic growth.
Wang was quoted as saying that local governments should offer "preferential policy support" and encourage more private investment in the export sector.
Tepid growth in the trade sector could hurt jobs, which the government wants to protect for fear that widespread unemployment could fuel social discontent and trigger unrest.
So far, China's labour market appears to be holding up well, despite signs that economic growth is steadily grinding to its lowest in a quarter of a century of around 7 per cent.
Data on growth in the first quarter will be released on Wednesday.