Economists world over were hoping for a China led recovery. But they all got a shock and a taste of reality
as government data showed the country’s exports in May fell a record 26.4 percent compared to last year.

This is inspite of a massive $586 billion stimulus package given by China. This stimulus package includes a focus on increasing infrastructure. With recent disappointing trade figures from South Korea, Taiwan and Germany, the numbers out of China suggests no light yet in sight at the end of the recessionary tunnel.

“We see evidence globally that productivity has slowed again,” says Frederic Neumann, senior economist at HSBC in Hong Kong. “You look month-on-month, it’s all very disappointing readings … it was not the big bounce that people are looking for.”

The drop in China was the largest ever year-on-year drop of exports, larger than April’s 22.6 percent drop and worse than analysts predicted. Imports to China dropped 25.2 percent last month, compared to 23 percent in April.

China has the second largest export economy in the world, next to Germany. Industrial orders in Germany fell a record 28.7 percent year-on-year in April.

The fall was the seventh straight month of decline in China’s once bustling export business, which has fueled the nation’s nearly 10 percent annual growth for the past decade and ascent to the world’s third largest economy.