China's November Exports Rise 0.5%... "Domestic and Foreign Demand Still Weak"

Imports down 0.6%... "Not a sign of economic rebound"

China's exports last month unexpectedly turned to an increase for the first time in seven months. However, since the growth rate is very small and imports actually decreased, there is an analysis that it is difficult to see this as a rebound in the Chinese economy.

[Image source=Yonhap News]

According to the General Administration of Customs of China on the 7th, November exports amounted to $291.93 billion (approximately 386 trillion won), up 0.5% compared to the same period last year. China's monthly export growth rate had been declining since recording 8.5% in April, but turned to an increase last month for the first time in seven months. It also exceeded market expectations (-1.1%).

China's imports last month were $223.54 billion, down 0.6% from a year earlier. This was below both the previous month (3.0%) and market expectations (3.3%). By country, imports from South Korea decreased by 20.1%, the largest decline. Imports from Taiwan also fell by 16.1%. As a result, the trade surplus for November was recorded at $68.4 billion.

On a cumulative basis from January to November this year, China's exports decreased by 5.2% compared to a year earlier, and imports also declined by 6.0%.

This announcement of China's export and import performance was the first monthly official statistic released after the international credit rating agency Moody's downgraded China's sovereign credit rating outlook from stable to negative, drawing attention. While some analyses suggest that the rebound in China's exports may indicate that manufacturing is recovering due to government stimulus measures, the small increase and the global economic slowdown make it uncertain whether this trend will continue. In particular, the decrease in imports, a barometer of domestic demand, confirms that domestic demand is not recovering either.

China's manufacturing Purchasing Managers' Index (PMI) for November also recorded 49.4 this month, continuing the economic contraction phase for two consecutive months following October's 49.5.

Bruce Fang, Chief Economist and Head of China Research at JLL, analyzed, "China's export increase is due to companies' price reduction strategies driven by expanded sales in recent months," adding, "External demand remains relatively weak, and holiday season orders are below expectations." He continued, "The data shows that both domestic and foreign demand face significant challenges," and added, "Policy support focused only on supply will not achieve sustainable results."