In 2010, industry experts and scholars anticipated that private investment, exports, and consumption would gradually replace the declining demand caused by weakening stimulus policies. Among these, export recovery was expected to play a central role in driving China’s economy. With the Christmas factor no longer influencing the market and European and American replenishment activities drawing to a close, the question remained: could February’s exports maintain the upward trend seen before the Spring Festival? Had China truly entered a sustained period of export growth?
To investigate this, a reporter from the Shanghai Securities Journal visited the Pearl River Delta, an area known for its concentration of export-oriented enterprises. The findings were encouraging. Many foreign trade companies were operating at high capacity, with strong signs of continued export recovery.
On February 26, the reporter visited Chenglin Shares in Bao’an, Shenzhen—a company that produces sanitary ware, 90% of which is exported to North America and Europe. Unlike the extended holiday break in 2009, the company had received more orders this year and resumed operations just four days after the Lunar New Year. Due to a shortage of labor, workers were working overtime nearly every day, operating on a two-shift system.
The field research revealed that the start-up of factories and port throughput, as reflected by foreign trade companies, ports, and customs, were all showing positive trends. Export recovery, which had begun at the end of 2009, continued into February. Industry analysts believed that the year-on-year export growth rate in the first quarter of 2010 might surpass the 10% to 15% forecasts made by some economists and investment banks, potentially reversing the previous drag on GDP growth.
In Dongguan’s Houjie, known as the “shoe capital,†factories were running at full capacity. The urgent need for workers led to the opening of new factories, giving the impression that the financial crisis had returned. At the local bus station, reporters were immediately surrounded by recruiters, who handed out promotional materials. Simple recruitment posters were posted on wooden boards, signaling the high demand for labor.
Inside the Bailu Industrial Zone, nearly every factory had a recruitment desk at the entrance. Recruitment booths lined the main roads, reflecting the widespread need for workers. According to Xiao, a staff member at the Houjie Labor Market, since October 2009, orders had been steadily increasing, and with the overall improvement in exports this year, the demand for labor had surged. As a result, almost all factories in Houjie were actively recruiting.
According to the MNI China Business Confidence Survey, the employee demand index rose to 61.3 in February, up from 53.8 in January—the highest level in five years. This indicated a strong rebound in employment conditions across the region.
Huacheng Footwear Company, which previously focused on domestic sales, began receiving significant export orders in the second half of 2009. This year, the company opened a new factory dedicated to producing export goods. Similarly, Jida Shoes Co., Ltd., which exports women’s shoes, reported a significant rebound in orders. Orders for over 150,000 pairs had nearly doubled compared to the same period last year, exceeding pre-crisis levels.
Xu Huajiang, general manager of Jida Shoes, noted that current orders had already reached May, suggesting that the order volume would likely continue to grow. He expressed optimism about the export outlook for the year.
Detai Paper, a newly opened company in the area, was also experiencing a surge in business. According to Wu, a security officer at Detai Paper, the factory was scheduled to start operations on March 1, primarily producing gift boxes for export to the U.S. The increase in orders from the previous year had necessitated the new facility.
The strong order activity in Dongguan’s factories was not an isolated case but rather a reflection of broader national trends. Although specific February data was not released, the MNI survey showed that production and new orders indices hit multi-year highs in February. The overall business conditions index climbed to 70.4, the highest since April 2007.
Shenzhen’s Yantian Port, one of the largest in the Pearl River Delta, served as a key indicator of export performance. After 10 consecutive months of declining cargo throughput, the port recorded its first positive growth in January 2010. In January, cargo throughput increased by 29.12% year-on-year, while container throughput rose by 16.14%.
February saw continued activity at Yantian Port, unaffected by the Spring Festival. On February 26, the reporter observed long queues of trucks waiting to enter the international container terminal. Gate staff noted that the post-holiday period was still relatively slow compared to late 2009, but much better than the previous year's low season.
Truck driver Wu from SEG Logistics confirmed that this year’s post-holiday period had been busier than usual. Previously, he would only transport one or two containers per week, but now he was handling one container daily. He recalled that the off-season for port transportation had started to recover significantly since September 2009, with business picking up toward the end of the year.
Customs experts attributed the rebound in port cargo throughput to the gradual global economic recovery and improved foreign trade exports. Since April 2009, foreign trade demand had stabilized and recovered, with exports turning positive in the fourth quarter. By early 2010, the trend was even more pronounced, with Shenzhen’s foreign trade cargo throughput reaching 13.739 million tons in January—an increase of 26.87% year-on-year.
Global trade demand continued to rebound, providing a boost to domestic exporters. Container shipments, shipping route prices, and the Baltic Dry Bulk Index (BDI) all showed positive signs, indicating that exports would likely continue to improve in the near future.
CIMC Group, which controls 55% of the global container market, reported a resurgence in dry box production. After being largely idle for a year, the company restarted operations in November 2009. Orders increased steadily, reaching over 25,000 TEUs in January 2010—far exceeding the less than 0.5 million TEUs sold in the first half of 2009.
Shipping companies also raised freight rates in response to growing demand. CSCL and COSCO both announced increases in sea freight rates to the U.S. and Europe in March and April. These price hikes reflected the improving global trade environment.
Finally, the BDI index showed signs of stabilization, rising 0.88% during the week of February 22–26. Analysts from Guosen Securities and other institutions believe that a further rise in BDI during the second quarter of 2010 is highly probable.
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