As the coronavirus pandemic persists, here’s one encouraging sign for Chinese exports

  • Economists point out that demand for coronavirus-related medical products, such as face masks, has helped China sell more products overseas than expected.
  • “Because of the health crisis in the past several months, we did see a high demand for PPE (personal protective equipment),” James Zhao, general manager of Cainiao’s global supply chain, told CNBC.
  • However,  the longer-term demand for China’s medical products is still unclear.
  • BEIJING — The global coronavirus pandemic shows little signs of letting up, and some say that’s creating further demand for China’s medical products.

    As the global economy continues to falter, the interest in Chinese medical supplies is an encouraging sign for the country’s exports — which support a critical part of its economy, as well as millions of jobs. Economists point out that demand for coronavirus-related products, such as face masks, has helped China sell more overseas than expected.

    Official, albeit frequently doubted data, showed Chinese exports surprised economists by rising in April and falling less than forecast in May.

    China will increase its market share in epidemic prevention supplies, which are expected to continue supporting China’s exports should there be a second wave of the coronavirus globally, according to Bruce Pang, head of macro and strategy research at China Renaissance, based on CNBC’s translation of his remarks in Mandarin.

    Trade figures for June are expected in about two weeks.

    “Because of the health crisis in the past several months, we did see a high demand for PPE (personal protective equipment),” James Zhao, general manager of Cainiao’s global supply chain, told CNBC last week.

    Cainiao, which is Alibaba’s logistics arm, anticipates that category will be one of the business’ growth areas as it plans rapid expansion in the next three years in a bid to overtake UPS as the top handler of parcels in the world by daily volume.

    “We are expecting the demand for PPE will be stable for (the) next several months,” Zhao said, citing conversations with the United Nations World Food Programme, which is working with Cainiao for global distribution of medical supplies.

    Covid-19 first emerged late last year in the Chinese city of Wuhan. As the disease spread rapidly in the country, more than half of China extended the Lunar New Year holiday shutdown in February in a bid to contain the virus. The economy shrank by 6.8% in the first quarter of the year.

    At the time, a surge in domestic demand for face masks and other medical supplies created a shortage, forcing China to repurpose existing manufacturing capacity and increase imports of the goods. – CNBC

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