At Canton Fair, Signs of a Chinese Export Slowdown GUANGZHOU, China - With as much floor space as nearly five Empire State buildings, the sprawling Canton Fair, which opened in Guangzhou on Tuesday morning, is a monument to China's industrial versatility and export prowess. But although the exhibits still offer products as varied as wheelbarrows and Segway knockoffs, the autumn session of the fair hints at the broader malaise now afflicting exporters across China and other East Asian nations. For the first time in recent record-keeping, the number of companies with exhibits has declined in both the spring and autumn sessions of the 56-year-old Canton Fair compared with a year earlier. Even during the global financial crisis in 2009, the number of exhibitors dropped in the spring but rebounded in the autumn. Buyers from all over the world still milled through the cavernous exhibition halls on Tuesday, but they appeared less numerous than during previous fairs. "It's slower than this time last year - today is opening day, and there are not many people here," said Ding Jiajun, the general manager of the Laizhou Toptool & Machinery Company, a 50-employee manufacturer of wrenches and vises in Yantian, in the eastern province of Shandong. China announced on Saturday that its exports dropped 0.25 percent in September in dollar terms compared with a year ago, below economists" expectations of 6 percent growth and far below the double-digit growth that China enjoyed for most of the past decade. In terms of the Chinese renminbi, which is what counts for Chinese exporters and overall Chinese economic output, exports fell a startling 3.6 percent last month. Nor is China alone in its difficulties. South Korea and Taiwan have already announced their export figures for September and fared even worse. They fell 1.5 percent and 7 percent respectively in dollar terms from a year ago; Japan has not yet released its figures but has also been struggling, although recent weakness in the yen may have helped its exports. "Exports are what powered Asia to prosperity," Frederic Neumann, the co-head of Asian economic research at HSBC, wrote in a research note on Tuesday. But the engine is showing signs of serious defects. The export environment for Asian exporters may grow worse before it gets better. A growing concern for Asian exporters lies in what effect the fiscal crisis in Washington might have on the American economy, and therefore on demand for Asian goods. "I am worried about what is going on in the United States right now with the looming debt crisis," said Li Shenggao, the sales manager at the Cangnan Keegao Arts & Crafts Factory, a manufacturer of gift bags and labels based in Wenzhou, China. If no solution is found, sooner or later the U.S. economy will slow down, which will weaken the U.S. dollar and in turn reduce the competitiveness of our products. The American fiscal difficulties come as a combination of strengthening currencies and spiraling costs is eroding the competitiveness of Asian manufacturers, particularly in China, the world's largest exporter. The slow but steady rise of China's renminbi against the dollar, although not fast enough for many American politicians at about 3 percent a year, is another pervasive concern among Chinese exporters. Mr. Li said his costs for plastic and other raw materials were also rising 5 percent to 10 percent a year, while a shortage of blue-collar labor was driving up workers" wages 15 percent a year. "Skilled workers with some technological know-how are still hard to come by," Mr. Li said. Mr. Ding at Laizhou Toptool, who sat in a booth with walls covered with tools in a rainbow of hues, said the cost of steel for his products had finally dipped this year. But wages in his area are climbing more than 20 percent a year as more young people go to college instead of factories, and prefer white-collar jobs when they graduate. Hilda Wang contributed reporting.