China export fall presents challenge to Shenzhen

[FT News]

After China announced a fall in exports, Shenzhen stands on the verge of another metamorphosis as exporters in low-end, labour-intensive sectors fall by the wayside

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In the late 1970s, Fish Farm Village was a small settlement on the banks of the Shenzhen river, which marked the border between China’s southern Guangdong province and the then British colony of Hong Kong.

Today the rural backwater has given way to a large retail podium and nine new residential tower blocks, all a short walk to a new border crossing where Shenzhen and Hong Kong’s light rail networks meet.

“The slowing economy has had some effect on sales, but the developer is reluctant to lower prices because it paid a lot for the land,” Wu Dikun, a n estate agent, says as he gives the Financial Times a tour of the area.

On the 30th anniversary of China’s reform era, Shenzhen stands on the verge of another metamorphosis as exporters in low-end, labour-intensive sectors fall by the wayside.

The Chinese government announced on Wednesday that exports fell in November from a year earlier for the first time in almost seven years.

With demand in many of its main markets slowing sharply, Chinese exports declined 2.2 per cent and imports fell 17.9 per cent last month from a year earlier, according to Chinese customs figures.

The Shenzhen special economic zone has been China’s leading export area for 15 years running. It and other cities in Guangdong’s Pearl River delta manufacturing heartland account for one-third of the country’s exports, the vast majority of which are assembled by migrant labourers. Three- quarters of Shenzhen’s official population of 8.6m lack the “permanent residency” status that would entitle them to full medical and education benefits.