China recently released the numbers for its trade performance for January of 2016. The lower than expected numbers have some worried. Other numbers released however, reveal China’s government efforts to curb the slowing market may be having some effect. Overall, as we will see in this article, these economic events have created a golden opportunity for businesses overseas. 

In January, for the 7th straight month of decline, China’s exports fell to 11.2% from a year earlier. For the 15th straight month of decline, China’s imports fell to 18.8%. These numbers released by the General Administration of Customs, were worse than expected and contributed to an additional fall in the markets. 

The depreciation of the yuan against the dollar has created golden opportunities for business abroad.

In January, Beijing lowered the value of the yuan for several reasons, one being to increase the number of exports out of the country. Lowering the value of the yuan against the dollar was hoped to naturally attract more foreign organizations to buy products made in China and to increase demand. China also posted a record trade surplus$63.3 billion in January which may have some positive economic results. (Trade surplus is when a country’s exports are greater than its imports.)

Trade surplus can be a positive and negative indicator for a country. If a country exports more than it imports, there is a greater need for resources and services within that country. Employment rates may go up with the increased demand. These are all positive elements of a trade surplus. ANZ economists Li-Gang Liu and Louis Lam recorded in a research note that this record surplus might help offset the further depreciation of the yuan. “The record level trade surplus indicated that China continued to run a large current account surplus, and this should help offset some of the capital outflow and alleviate some depreciation pressure on the yuan.”

China's record trade surplus of $63.3 billion worries some, others hope it will help the economy get a foothold.

Although China’s economic future is uncertain, these uncertainties and lower than expected numbers are making many believe China will make greater efforts to increase exports in 2016 and 2017. Increasing demand for their products naturally will create a more buying opportunities for businesses overseas. Currently, China has recently shown greater efforts to increase exports including establishing e-commerce hub pilot zones, decreasing the value of the yuan, and encouraging companies to increase their abilities in Internet development