BEIJING: China’s exports slumped more than expected in November but the decline in imports slowed, a tentative sign that domestic demand is on the mend, figures showed Tuesday.
November exports fell 6.8 percent from a year ago, dropping for a fifth month, while imports fell 8.7 percent over the same period, China’s General Administration of Customs said on Tuesday. The trade surplus narrowed to $54.1 million from the record high of $61.64 million last month
The trade figures compare with a Reuters’ analyst poll of a decline of 5.0 percent for exports and a fall of 12.6 percent for exports. Exports had fallen by 6.9 percent from a year earlier in October while imports had tumbled 18.8 percent.
Separately, yuan-denominated data showed a 3.7 percent fall in exports from a year earlier, while imports fell 5.6 percent. That left the country with a trade surplus of 343.10 billion yuan for the month.
Capital Economics’ China economist Julian Evans-Pritchard said although the exports data were disappointing, suggesting foreign demand remains subdued, a recovery in imports hints at a policy driven pick-up in domestic demand. The pick-up in imports was also partly due to a sharp drop in global commodity prices late last year, he noted.
Chinese growth dipped to 6.9 percent in the third quarter, dropping below the 7 percent mark for the first time since the global financial crisis of 2008-2009, sparking concerns of a hard landing in the world’s second largest economy after years of explosive growth.
President Xi Jingping said in November the country’s economic growth rate will not be less than 6.5 percent in the five years to 2020. To support the economy, the People’s Bank of China has repeatedly cut interest rate and devalued the yuan against the U.S. dollar this year. Evans-Pritchard said trade growth is likely to pick up over the coming quarters.
“Stronger growth in China’s main trading partners ought to shore up exports while a policy drive rebound in investment spending will boost imports,” he said in a note Tuesday. China is widely expected to post its slowest economic growth in a quarter of a century this year as activity is weighed down by weak demand at home and abroad, factory overcapacity, high debt levels and cooling investment.
