Upsets in the global economy contribute to lowering China’s export growth outlook. This slowdown could very well precede a fundamental change in Chinese exports, writes Wall Street Journal on the basis of an interview with Danish Maersk Line’s CEO, Søren Skou.
The CEO for one of the World’s largest container shipping companies points out that the Chinese market is facing changes as salaries are on a continuing upward trend, thereby making China less attractive as a manufacturing base for companies.
”It is obvious that China will become less competitive in some areas” Søren Skou says, according to the Journal, adding that China is the most important market for the shipping giant and that it is increasingly felt that the manufacturing of goods, such as shoes and toys, is gradually being relocated to countries such as Vietnam and Bangladesh.
While this does not mean that the Chinese export boom is coming to a halt – it is slowing down.
Right now the country’s export growth is at the lowest level since 2009, when basically the entire World was brought to its knees by the financial crisis. During the first seven months of 2012 the Chinese export grew by 7.8 percent.
Among the factors helping maintain a high level of exports is the fact that China has been successful in continually adjusting its’ export focus. It may well be that production of more labor intensive goods is starting to shift to competing countries, but at the same time the production of other, more technically complicated, goods and products has been increasing.
The shipping giant Maersk Line notes a growing trend of shipping products such as various electronics and solar panels out of China. The next step could be automobiles, spare parts, biotech and chemical products, Wall Street Journal writes.