Maritime
Strong China January trade data sparks cheers, doubts
BEIJING – China surprised markets with a thumping trade performance in January as import growth hit a six-month high, drawing some skepticism about the data but still allaying fears of a deepening economic malaise.
Analysts who had expected the long Lunar New Year holiday to drag on January’s trade warned that the figures may be inflated by fake trade transactions, where traders forge deals to sneak cash into the country past capital controls.
The value of China’s total exports climbed 10.6 percent in January from a year earlier, the Customs Administration said on Wednesday, more than five times market forecasts for a 2 percent rise.
The value of imports also jumped 10 percent from a year ago as China bought record volumes of iron ore, crude oil and copper. That lifted import growth to its highest level since July, handily beating predictions for a 3 percent gain.
The country’s trade surplus rose to $31.9 billion, well above forecasts of $23.7 billion and December’s $25.6 billion.
“We find this strong level of export growth puzzling,” said Zhang Zhiwei, an economist at Nomura. “It is unclear to what extent the strong export data reflects the true strength in the economy.”
A run of underwhelming economic data from China in recent weeks had steeled investors for another disappointment on Wednesday, as markets braced themselves for more signs that the world’s second-largest economy is losing momentum.
Fears that China may be slipping into a sharper-than-expected slowdown were believed to have fed a fierce selloff in global financial markets in January, with emerging markets hit particularly hard.
As the Lunar New Year falls in January in some years and in February in others, distorting trends early in the year, it may be months before investors see data which offers more reliable clues on the economy’s true direction.
Still, Asian investors welcomed the trade data and pushed stock prices higher for the fourth straight session. An optimistic economic outlook from new Federal Reserve Chair Janet Yellen also cheered markets.
A resilient Chinese economy is good news for the world, particularly for major commodity exporters such as Australia.
Already the world’s biggest exporter, China may overtake the United States to be the world’s largest importer this year, HSBC Bank has predicted.
Economists expect China’s economy to grow at its slackest pace in 14 years this year at 7.4 percent. But even then, it is still expected to add twice as much demand to the world economy than the United States, HSBC said.
“Looking ahead, improving conditions in developed economies should continue to support Chinese exports,” said Julian Evans-Pritchard, an economist at Capital Markets in Singapore.
SCEPTICISM
But not all economists were so upbeat. Many struggled to explain the unexpectedly buoyant trade figures, especially since Taiwan and South Korea both saw export sales slump in January, when the Lunar New Year holiday reduced the number of working days.
Four separate purchasing managers’ indices also showed China’s factory and services sectors sliding to multi-month or multi-year lows in January as export and domestic orders fell.
Even arguments that China’s export growth in January was artificially lifted by bogus trade deals were not supported by data at face value.
Export growth to Hong Kong, whose close proximity to China has made it a favorite destination for fake transactions in the past, fell 18 percent in January, compared to December’s 2.3 percent rise.
Analysts also found it hard to explain China’s record purchase of raw materials in January as underlying demand has not shown any convincing signs of a pick-up.
Indeed, the level of China’s iron ore stockpiles is at its highest in nearly 1-1/2 years, lending weight to arguments that the jump in imports was down to China stockpiling before the Lunar New Year holiday.
China’s biggest annual holiday, the Lunar New Year usually dampens economic activity as factories and offices close shop for long periods before and after the festivities.
Although China’s economic data is in theory adjusted for seasonal factors to smoothen out fluctuations due to events such as holidays, most experts do not agree on the best method for seasonal adjustments and do their calculations differently.
“Every time we think we understand what the Chinese New Year effect is, we will hear later that there has been some adjustments,” said Louis Kujis, an economist at RBS.
“It’s fair to say that this should not make people more nervous about global demand and China’s economy, but I also think we have to keep on scrutinizing the data and wondering how much this really means.”
– REUTERS
The Honourable Minister of Marine and Blue Economy, Adegboyega Oyetola has deposited three Instruments of Accession to IMO Conventions signed by President Bola Ahmed Tinubu with the global body.
He did so on Tuesday, at the headquarters of the International Maritime Organization (IMO), which acts as the repository for these conventions.
This move, coming a few weeks after Nigeria declared its intention to contest election for a seat on the IMO Council, is expected to enhance Nigeria’s maritime governance and align its practices with international standards, promoting maritime safety, security, and environmental protection.
Shortly after the presentation ceremonies, Oyetola informed the IMO Secretary General, Arsenio Dominguez, of the President’s commitment to ensuring that Nigeria aligns with international maritime standards regarding maritime safety, security, and sustainable marine practices.
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He also called on the IMO to extend technical support to Nigeria.
In his words, “These instruments, duly acceded by His Excellency, the President of the Federal Republic of Nigeria, signify Nigeria’s continued commitment to aligning with international maritime standards, ensuring maritime safety and security, and promoting sustainable marine practices.
“We hereby request tailored technical cooperation under the Integrated Technical Cooperation Programme (ITCP) to enhance Nigeria’s compliance with IMO conventions and improve our maritime governance and implementation of the instruments we submitted today.”
On his part, Dominguez, acknowledged with appreciation the formal deposition of the Instruments of Accession, stating that it underscores Nigeria’s steadfast commitment to aligning with global maritime standards.
“I congratulate Nigeria for its exceptional efforts in acceding to these six critical IMO instruments. I encourage continued momentum by securing presidential assent to additional key conventions. We at the IMO remains fully committed to supporting Nigeria through technical cooperation and capacity-building initiatives to ensure the successful implementation of these instruments,” he stated.
The instruments Oyetola handed over to Dominguez include the instrument of accession to the 2005 Protocol to the Convention for the Suppression of Unlawful Acts against the Safety of Fixed Platforms Located on the Continental Shelf (SUA Protocol 2005), the instrument of accession to the International Convention on Standards of Training, Certification, and Watchkeeping for Fishing Vessel Personnel (STCW-F), and the instrument of accession to the Protocol Relating to Intervention on the High Seas in Cases of Pollution by Substances Other Than Oil (Intervention Protocol 1973).
It was gathered that three other Instruments of Accession signed by President Tinubu are undergoing further steps to complete the processes for their deposit.
Funds accrued under the Cabotage Vessel Financing Fund (CVFF) are intact and currently held with the Central Bank of Nigeria (CBN) under the Single Treasury Account (TSA).
This assertion was made by the Nigerian Maritime Administration and Safety Agency (NIMASA), in a statement in Lagos on Tuesday.
The clarification became necessary to address “a misleading publication alleging that funds have disappeared from the CVFF account”.
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The statement reads, in part, “The report of a missing money is both misleading and false.
“For the record, the Cabotage Vessel Financing Fund, securely held in the NIMASA account at the Central Bank of Nigeria (CBN), remains intact. There has been no disappearance of funds, and no illegal transactions, as the article suggests. This misinformation is a figment of the authors imagination, aimed at undermining NIMASA’s integrity, and mislead the public about the Agency’s operations.
“The Management of NIMASA will ensure that the CVFF is utilised in line with its statutory purpose. NIMASA Director General, Dr Mobereola has assured stakeholders of the safety of funds under the CVFF.”
The statement cited the DG thus, “Let us be clear that the CVFF account at the Central Bank of Nigeria is safe, intact, and secure. We at NIMASA will continue to manage it with the utmost responsibility, and there are no irregularities or illegal activities surrounding the funds. I urge the public to disregard this false narrative and to continue trusting the Agency’s ability to uphold the integrity of Nigeria’s maritime sector”.
It was gathered that the CVFF is a fund established under section 42 of the Coastal and Inland Shipping (Cabotage) Act 2003 to promote the development of indigenous ship acquisition capacity and to provide credit facilities to local maritime operators.
The NIMASA, assured of its commitment “to transparency, accountability, and the advancement of Nigeria’s maritime sector.”
Edo State Governor, Senator Monday Okpebholo appears eager to deliver the dividends of democracy to his constituents.
This is discernible from the frenzy of activities being witnessed in his first few days on the job, including dissolution of boards, constitution of investigative panels, flagging off of infrastructure projects, among others.
In the bid to address the perennial road traffic congestion negatively impacting economic and social activities in Benin City, the state capital, Gov Okpebholo on Wednesday flagged off the construction of a flyover bridge.
Biztellers reports that the flyover bridge around the popular Ramat Park in the city centre is the first of such in the history of Edo State.
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The Edo State Government made the disclosure in its verified handle on micro-blogging site, X, on Wednesday.
It wrote, “Traffic decongestion: Gov Okpebholo flags off first flyover in Edo.
“Edo State Governor, Sen. Monday Okpebholo has flagged off the construction of a flyover bridge at Ramat Park, Benin City, the State Capital, as part of immediate efforts to reduce traffic congestion in the city.”
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