CGTN Europe interviewed Marc Ostwald, Chief Economist & Global Strategist, ADM ISI
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00:00Let's dig into all of this data and more with Mark Oswald, he's Chief Economist and Global Strategist at ADMISI.
00:07Great to see you again, Mark.
00:09So, is this everyone doing deals before Trump and his promise of tariffs return to the White House?
00:16There's an element of that.
00:19If one looks at exports to the US for the year, they're up 15.7%.
00:25That's a very robust performance and some of that preemption of tariffs is definitely in there.
00:31But the biggest growth in exports was actually to ASEAN with also strong performances to Taiwan and indeed South Korea.
00:40So, it's not all about tariffs.
00:42It is also generally strengthening demand in Asia, which is encouraging for China and it's encouraging in terms of the Asian outlook.
00:53Above all, as you mentioned, the auto exports, the strength of the exports to the EU is basically a reflection of those auto exports to the EU.
01:07It's also basically on the reverse side of that coin of a failing European auto sector as well, particularly in terms of EVs.
01:17So, I wonder then what you think the impact's been of China's stimulus measures to support the industrial sector and beyond.
01:26To my way of thinking, when I look at this data, it shows just how much of a boost the Q4 GDP data, which we'll get on Friday, should get from external demand.
01:42External demand didn't fall off in the way that a lot of people have been predicting, which is also encouraging.
01:49But it's not really a reflection of those stimulus measures.
01:54Even when one looks at the import data, to a large extent, the strengths of things like iron ore are put down more to a price factor rather than a demand factor.
02:08And things in the strength of LNG imports are also very impressive.
02:14But that's a reflection of a switch in freight and in the way that trucks are powered in China.
02:22And it's far more to do with moving towards LNG-powered trucks, which again is encouraging because it's again also all part of where China is leading in terms of the auto and freight sector.
02:36Okay, so that's the external demand picture.
02:39What about the internal demand picture?
02:41What would you like to see, what would the markets like to see in terms of China boosting domestic demand?
02:51They would really like to see a lot of these, the voucher systems, the so-called cash for trash, as it's called in the Western world,
03:02basically people upgrading their domestic appliances, televisions, PCs.
03:07And a big boost to retail sales because retail sales basically, we're looking at 3.5% for December.
03:15That's a long way short of the 8% we were averaging pre-pandemic.
03:21And it would be a signal that consumers are getting a little bit more confident.
03:28The other aspect that one would like to see also is a decent boost to new yuan loans, which would reflect then the fact that interest rates have come down
03:40and the various measures which are being put in place to encourage more borrowing are getting some traction outside of the public sector.
03:49The public sector is the public sector, but what one wants really is private sector demand both at a business level and a consumer level to show some more strength.
03:58The industrial sector obviously remains robust.
04:01It sure does. Mark Oswald, ADMISI. Always a pleasure. Thank you very much.