from Follow the Money

More bad trade data from Asia

January 09, 2009

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Taiwan’s December exports are down over 40% y/y -- largely because of a huge fall in exports of electronic components to China. The fall topped expectations. It adds to the mounting evidence that the current global deceleration is quite sharp and quite deep.

Taiwan’s imports are also down by around 45%. Thank the big fall in commodity prices. Taiwan managed to post a trade surplus in December even with the enormous fall in its exports.

Korea’s exports were also down in December -- though the 17.4% y/y fall in December wasn’t quite as large at the 19% fall in November. Imports though fell by more -- over 21%. And Korea also posted a (small) trade surplus.

My guess -- based on the fall in Taiwan’s exports to China and the fall in commodity prices -- is that China’s December trade data will show a quite significant fall in imports, keeping China’s surplus large even as China’s exports fall sharply.

The large fall in Germany’s November exports highlights that the slump in trade is global. Japan’s exports fell by more (in percentage terms) than Germany’s exports in November. US exports are almost certain to start shrinking too.

Expectations have been revised down dramatically, but most data points still seem to be worse than expected. That worries me.