Dividends and China’s exports bounce back, but future looks shaky

For the past 20 plus years, China has been the manufacturing capital of the world, if you go in Walmart which is the world’s largest retailer, most of the stuff is made in China. To do that billions of dollars have been spent to ensure the cost to manufacture, transport and ship to a store remains less than doing somewhere in the US. The transportation is by containers and the shipyards pick up the container, place in on a ship, transport across the seas and shipyards take it off to be placed on a railbed to go to a truck to go to the local distribution area and sent to a store. (if you enjoy watching logistical videos, there are many on the shipyards of China). It seems logical to keep an eye on volume of containers shipped from China.

In an article by Ellen Zhang and Ryan Woo of Reuters, according to official customs data, outbound shipments rose 17.9% in June, compared with a 16% rise in May, but analysts were only expecting 12%.

According to Julian Evans-Pritchard, senior China economist at Capital Economics, although total container throughput at Chinese ports was little changed, the recent weakness in domestic shipping demand has allowed more port capacity for foreign trade.

Daily container throughput in ports in Shanghai are recovered to 95% of year earlier levels according to official data. Exports of computers, steel products and autos contributed to the robust growth.

At the ports, commodity imports have declined, because Chinese officials have locked down areas of the country because of COVID under a zero COVID strategy.

China posted a trade surplus of $97.94 billion in June, surpassing analysts expectation of $75.70 billion.

Linking to dividend paying stocks, it is hard to find a company in the world which does not do some aspect of business with China. For decades China and the development of the country has been a stabilizing force in the world of commerce. Most of us depend on some aspect of Chinese economy and that can be very good. All countries have official statistics and economists to interpret them. Keeping an eye on them can be a good thing for your investments.

There are more questions than answers, till the next time – to raising questions.


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