Mixed messages

The gloomy global economy dampened the China Import and Export Fair, or Canton Fair, a barometer of the country's foreign trade situation. The event is held twice a year, in spring and in autumn. This autumn's fair is being held from October 15 to November 4, in Guangzhou, capital of south China's Guangdong Province.

The opening day of the Canton Fair saw fewer people in attendance due to a lackluster global trade situation. "This is the most sluggish Canton Fair I've ever seen," said Liu Fengyi, Board Chairman of the GongChang Technology Co. Ltd.

Liang Huan, a sales assistant for an energy-saving lamp company from Hangzhou, said this year her company's business is not performing as strong as last year.

"Our major markets are in Europe. The European debt woes are having a direct impact on our orders," she said.

Qiu Zhen, a sales manager for a Qingdao factory that makes solar-energy street lamps, said that the anti-subsidy investigation against China's solar industry has hurt her company's business.

"Now we are diverting our efforts to another kind of lamp, which is unrelated to the solar industry," she said.

Forecasts for the number of participants, including buyers and exhibitors, as well as turnover, are "not optimistic," said Liu Jianjun, a spokesman for the Canton Fair.

Liu attributed the situation to flagging external demand, rising trade frictions, the appreciation of the yuan, and seasonal factors. "Importers from emerging economies, such as Latin America and Africa, tend to purchase extensively in the spring session. And the strained Sino-Japanese relationship also took a toll on bilateral trade," Liu said.

September's macroeconomic data offered some comfort to Chinese authorities.

China's exports and imports picked up in September but a strong rebound in foreign trade in the near future is seen as unlikely, say analysts.

Exports rose 9.9 percent year on year to $186.35 billion in September, according to the General Administration of Customs (GAC) on October 14.

September's export volume hit a record monthly high, and growth was higher than the 2.7-percent year-on-year increase posted in August, the GAC said.

The growth in September reflected the run-up to the Christmas and New Year holidays, said Zhang Yansheng, an international trade specialist. But as the euro zone debt crisis continues to fester in Europe, China's largest trade partner, and recovery remains slow in the United States, the fundamentals that affect China's trade situation are unlikely to improve anytime soon.

The easing of policies by foreign governments and orders for the Christmas shopping season have driven up exports to developed economies, said Chen Hufei, a financial researcher at the Bank of Communications.

Li Jian, a foreign trade expert at the Ministry of Commerce's research institute, said China's own efforts to help trade firms reduce transaction costs and improve efficiency also contributed to the recovery.

To boost foreign trade, the State Council in September issued a batch of measures, including speeding up export tax rebates, reducing administrative costs for companies, lowering financing costs for small and micro-sized companies and increasing credit to exporters.

Also, some exporters may have hurried to deliver their orders before the eight-day National Day holiday (September 30-October 7) and caused the higher growth in exports in September, Li said.