, 8 tweets, 2 min read Read on Twitter
A black Friday in #China as exports shrink 20%, stocks plunges 4% and homeowners face new taxes. 👎🇨🇳👎  scmp.com/economy/china-…
China’s General Administration of Customs said exports were down by 20% in February year on year as the trade war with the United States took its toll on the world’s second-biggest economy.
China’s stock market also had its worst day in five months on Friday, with the benchmark Shanghai composite stock index shedding 4.4 per cent. Investor sentiment remains fragile, indicating that optimistic forecasts of a sustained bull market may be premature.
In addition, China’s top lawmaker, Li Zhanshu, told a National People’s Congress session on Friday afternoon that the legislature was considering a law that could for the first time authorise the government to collect taxes from homeowners.
Policymakers debated for years to use property taxes to cool overheated real estate markets but didn't happen because of strong opposition from property owners. And with the domestic property market already weakening, a new tax would dampen real estate purchases.
The figures also suggest that the risks to China’s economy could be bigger than expected and challenge the widely held assumption that a likely trade deal with the US and Beijing’s policy easing moves will be enough to stabilise the economy.
Macquarie Capital economist Larry Hu said the weaker-than-expected trade data was “the first wake-up call” for the Chinese stock market, which had rallied on optimistic expectations.
Hu said the deep fall in exports showed there was no guarantee of a rosy future and it would take an improvement in economic data in coming months to indicate whether China’s US$13.6 trillion economy was on a solid footing.
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