Opinion Challenges remain after Canton Fair returns from Covid hiatus

The biennial Canton Trade Fair has evolved across China over the years since it was first held in Guangzhou in 1957. Initially, the focus was on raw materials, but later shifted to manufacturing as China established itself as the world's workshop.

More developments were on display at the latest show, with the country's electric vehicle (EV) manufacturing prowess and cutting-edge production taking center stage. The fair has long been considered a barometer of the health of China's trade and industrial progress.

By that measure, it has still not fully recovered from the pandemic. Attendance has bounced back just four years after the country's biggest trade show suffered its biggest blow: It was canceled at the start of the pandemic in April 2020 and only restarted in April 2023.

People, at least, are back. The spring session set a new attendance record with 246,000 participants over three phases in April and May, approximately 25 percent more than the previous autumn session.

Despite the increase in the number of visitors, they held their checkbooks more tightly. Organizers said participants signed deals worth US$24.7 billion, still well below 2019's US$29.3 billion, although it was a 10 percent increase from the autumn fair.

'Why so many foreigners?' EV-hungry buyers take center stage at Canton Fair

Over the years, the fair has also served as a barometer for trade and diplomatic friendships and differences. The first fair was held during the Sino-Soviet friendship building era.

But as tensions with the Soviet Union increased, Richard Nixon became the first US president to visit China in February 1972, and a few weeks later, American businessmen attended the fair for the first time.

This stress barometer was at work again this year. About 160,000 of the attendees were from China's Belt and Road Initiative partners.

Only 50,000 were from Europe and the United States, which has accused China of allegedly dumping EVs, lithium-ion batteries and solar panels, while Washington blocks Beijing from access to high-end semiconductors. European and American attendance was 10 percent higher than the autumn fair, but the value of deals fell.

April trade data showed exports returning to healthy growth on a rebound in global demand, but analysts cautioned that the domestic market remains the key economic driver.

Export demand helped China's economy grow a better-than-expected 5.3 percent rate in the first quarter, but weak domestic consumption and a declining property market remain under pressure. Canton Fair organizers said they hope buyers will continue their work after the event, making appointments to visit factories and inspect production capacity.

By the time the next session begins in October, when most of the year has passed, a more complete picture of China's trade and economic recovery will emerge.

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