Chinese exports plummet and GDP could be the lowest since 1990.

BEIJING (Reuters) - China's exports fell sharply in the first two months of the year and imports slowed, as the health crisis caused by the coronavirus outbreak caused major disruptions to trade operations, global supply chains and economic activity.

The disappointing trade report will likely reinforce fears that China's economic growth halved in the first quarter, to its weakest level since 1990, due to the epidemic and the government's severe containment measures that hit industrial production and affected demand.

Exports fell 17,2% in January-February compared to the same period last year, according to customs data released on Saturday, marking the sharpest decline since February 2019.

This compares to a 14% drop suggested by a Reuters poll of analysts and a 7,9% increase in December.

Imports fell 4% compared to the previous year, but were better than market expectations of a 15% drop. They had increased 16,5% in December, driven in part by a preliminary trade agreement with the US.

China recorded a trade deficit of $7,09 billion during the period, compared to an expected surplus of $24,6 billion in the survey.

Industrial activity contracted at the fastest pace of any February, even worse than during the global financial crisis, an official manufacturing indicator showed last weekend, due to a sharp drop in orders.

The epidemic has killed more than 3.000 and infected more than 80.000 in China. Although the number of new infections in China is falling and local governments are slowly relaxing emergency measures, analysts say that many businesses are taking longer to reopen than expected and may not return to normal production until April.

These delays threaten to have an even longer and more costly impact on the economies of China's main trading partners, many of which rely heavily on parts and components manufactured in China.

China's trade surplus with the United States in the first two months of the year was $25,37 billion, according to a Reuters calculation based on Chinese customs data, much lower than a surplus of $42,16 billion in the same period last year.

Soybean imports in the first two months of 2020 increased by 14,2% compared to the same period last year, due to the customs clearance of shipments to the US purchased during a trade truce at the end of 2019.

After months of tensions and tariff increases that disrupted bilateral trade, the world's two largest economies reached a provisional trade agreement in January that cut some US tariffs on Chinese goods in exchange for Chinese promises to massively increase purchases of US goods and services.

The U.S. expects China to honor these commitments despite the coronavirus outbreak, a U.S. official said in February.