China's exports recovering from global economic crisis -- Global Sources survey shows

USA - English

• USA - English

HONG KONG, April 7 /PRNewswire-Asia/ -- China's exports are recovering from the impact of the global financial crisis, according to a survey of 551 China exporters by Global Sources (Nasdaq: GSOL) (http://www.globalsources.com ).

Sixty-four percent of the suppliers interviewed said their overseas sales have seen some recovery, while 8 percent claim strong recovery. Only 11 percent of manufacturers have not yet experienced a rebound in overseas orders.

"China's export industries are showing strong signs of a rebound, as orders from the U.S. and the EU have started to increase," said Craig Pepples, Global Sources' chief operating officer. The survey further indicates China suppliers are optimistic about overseas sales in the coming months. Eighty- three percent of companies expect an increase in orders through June 2010, 13 percent anticipate no change, while only four percent foresee a drop in orders.

Exporters, however, are conservative about sales growth projections. More than half of suppliers expecting growth in orders predict increases between 5 and 15 percent. Among surveyed suppliers:

    -- 17 percent of suppliers expect overseas orders to grow by more than
       25 percent;
    -- 16 percent anticipate expansion between 16 and 25 percent;
    -- 19 percent of suppliers expect 11 to 15 percent growth;
    -- 38 percent see a 5 to 10 percent rise in orders, and;
    -- 10 percent forecast shipments to increase by up to 5 percent.

Renewed focus on the U.S. and EU markets

Another significant finding of the survey is a revived emphasis on the traditional export markets of the U.S. and EU. In 2009, many exporters began exploring emerging markets, which helped suppliers minimize losses as orders from conventional destinations declined.

In the first half of 2010, however, suppliers have shifted emphasis back to the U.S. and EU. Compared to the second half of 2009, 23 percent fewer survey respondents are planning to target non-EU countries and other emerging markets in first half of 2010. In contrast, 17 percent more suppliers cited that they plan to concentrate on the U.S., Canada and the EU markets.

Price competition the main challenge

Despite the positive economic outlook, suppliers noted buyers remain as price-sensitive as they were during the height of the financial downturn.

"With the rebound in export orders, costs of raw materials and labor are on the rise," Pepples said. "But buyers are still finding it difficult to take on the additional costs. This is adding pressure to suppliers' profit margins."

    Regarding challenges faced by surveyed suppliers:
    -- 34 percent said price competition was their biggest concern;
    -- 25 percent cited higher labor and raw material costs as a critical
       issue, and;
    -- Also noted were fewer orders due to unstable economic conditions,
       trade protectionism and labor shortage.

Global Sources market analysts interviewed 551 China exporters from the telecom, home products, fashion accessories, garments, textiles, hardware, sports equipment and security products sectors in January and February 2010. Nearly half of respondents are based in Guangdong province, about one-third are from Zhejiang and 9 percent from Fujian.

The complete survey can be downloaded for free at http://www.globalsources.com/SITE/ECONOMIC-SURVEY.HTM .

About Global Sources

Global Sources is a leading business-to-business media company and a primary facilitator of trade with Greater China. The core business uses English-language media to facilitate trade from Greater China to the world. The other business segment utilizes Chinese-language media to enable companies to sell to, and within Greater China.

The company provides sourcing information to volume buyers and integrated marketing services to suppliers. It helps a community of over 888,000 active buyers source more profitably from complex overseas supply markets. With the goal of providing the most effective ways possible to advertise, market and sell, Global Sources enables suppliers to sell to hard-to-reach buyers in over 240 countries.

The company offers the most extensive range of media and export marketing services in the industries it serves. It delivers information on 4.5 million products and more than 253,000 suppliers annually through 14 online marketplaces, 13 monthly magazines, over 80 sourcing research reports and 17 specialized trade shows which run 55 times a year across 10 cities. Suppliers receive more than 136 million sales leads annually from buyers through Global Sources Online (http://www.globalsources.com ) alone.

Global Sources has been facilitating global trade for 39 years. Global Sources' network covers more than 60 cities worldwide. In mainland China, Global Sources has about 2,500 team members in more than 40 locations, and a community of over 1 million registered online users and magazine readers for its Chinese-language media.

    Global Sources Press Contact in Asia:
     Camellia So
     Tel:   +852-2555-5021
     Email: [email protected]

    Global Sources Press Contact in U.S.:
     James W.W. Strachan
     Tel:   +1-480-664-8309
     Email: [email protected]

    Global Sources Investor Contact in Asia:
     Investor Relations Department
     Tel:   +852-2555-4777
     Email: [email protected]

    Global Sources Investor Contact in U.S.:
     Kirsten Chapman & Timothy Dien
     Lippert/Heilshorn & Associates, Inc.
     Tel:   +1-415-433-3777
     Email: [email protected]

SOURCE Global Sources