Trade Arabia News Service reported that exports from the GCC countries to China rose to USD 7.1 billion in October from a yearly low of USD 4.9 billion in August, marking a 45.6% increase in just Q1.
Growth expectations in the Chinese economy show a strong correlation with its imports of energy, added the report from Kuwait China Investment Company, which specializes in emerging Asia investments.
Mr Camille Accad, economist at KCIC, who prepared the report said t hat the Purchasing Manager Index, a leading indicator of Chinese GDP growth, is also an accurate predictor of oil imports from the GCC. For the most part of this year, global growth eased, including China’s, the economic powerhouse that led the global recovery between 2009 and 2010.
Lower global growth diminishes demand for commodities across the world, such as industrial metals and energy products, which generally translates into a decline in their prices, bringing about reduced revenues for oil exporting countries in spite of their capacity to affect prices.
However, in the last few months, China has shown signs of a recovery. All the major sectors of the country’s economy have recently indicated an upward trend, as last week’s retail sales, industrial production and investment indicators showed.
About 4.9% of China’s total imports came from the Gulf in October, up from its August trough of 3.2%, tracking PMI closely. This week, the HSBC Flash PMI confirmed the ongoing recovery, as it grew for a third consecutive month, from 50.4 to 50.9 in December.
According to KCIC, this suggests that China’s demand for energy and other commodities will increase as well, which in turn will boost oil imports from the GCC.
Source:
http://www.steelguru.com/middle_east_news/GCC_exports_to_China_hit_USD_7_billion_in_Oct/296322.html
