The surge tide from the world financial downturn washed ashore at this year's installment of the East China Fair in Shanghai - an important barometer of the country's export market.

As the five-day event closed yesterday, organizers reported that total contract value tumbled 39 percent from last year to US$2.24 billion.

Attendance was also down, dropping 5.4 percent to 18,229 overseas visitors, according to the Shanghai Foreign Economic Relations and Trade Commission, the event's organizer.

"The fair took place at a time when many foreign economies, especially the biggest buyer at the fair, Japan, are mired in recession," said Wang Qingjiang, the director of the commission's Trade Development Department.

Participants in the annual fair sell commodities ranging from bowls to shoes, garments to electronic gadgets. Garment deals, the biggest division, fell 32.5 percent to US$1.25 billion.

But the commission said that despite the austere environment, the results of the largest regional fair in China exceeded expectations.

China experienced negative growth in both its exports and imports in November for the first time since the country's entry to the World Trade Organization.

China's exports slumped 17.5 percent, the fastest pace in more than a decade, to US$90.45 billion in January, the third straight monthly decline. That falloff came after a 2.8 percent drop in December and a 2.2 percent decrease in November.

Fair exhibitors said the biggest obstacle they face is weak purchasing power in their export destinations as a result of the global turmoil.

Visitors came from 140 countries and regions, compared with 145 last year. Japan accounted for 37.3 percent of the overseas visitors.

But deals made by Japanese traders were down 27.5 percent, totaling US$656.9 million.

The European Union was ranked second with a deal volume of US$524.36 million, a 40 percent drop.

It was followed by companies from the United States, which placed orders worth US$310.6 million, a decrease of 46.7 percent.

"Far fewer customers came to our booth and showed an interest in our business compared with previous years, but we expected that," said Tony Yao, an official from Shanghai Twintex Textiles Import & Export Co.

The firm has been exhibiting at the fair for several years and hoped to expand its customer list.

But this year even regulars scaled back orders or asked for lower prices. As a result of the slowdown, the company is considering a move to north or central China where labor and land costs are lower.

(Shanghai Daily March 6, 2009)