The pace of Chinese export growth is slowing, official data showed yesterday, but analysts say stronger-than-expected US demand helped narrow China’s politically sensitive trade surplus last month.
The combined value of China’s monthly exports and imports rose from October, the data showed, despite the ongoing turmoil in the country’s key markets of Europe and the US.
China’s trade surplus — a constant bugbear for major trade partners who say its exports are cheap because its currency is undervalued — narrowed to US$14.5 billion last month from US$17 billion in October, China’s customs office said.
The surprisingly strong data came amid growing concerns over weakness in the country’s vast manufacturing sector, which employs hundreds of millions of people and is a major driver of the world’s second-largest economy.
China’s exports rose 13.8 percent year-on-year to US$174.46 billion last month, up from US$157.49 billion in October, the customs agency said in a statement, and greater than the 10.4 percent expected by 16 economists polled by Dow Jones newswires.
Analysts said the unexpected strength in the monthly exports rise did not change the overall slowing trend.
“Exports are decelerating,” IHS Global Insight economist Ren Xianfang (任現芳) said. “If you compare with August, their growth is almost down 10 percentage points. It is a gradual deceleration.”
The month-on-month growth came on the back of a rise in China’s shipments to the US, which rose to US$30.94 billion last month from US$28.60 billion the previous month.
Despite economic hardships in the West, the better-than-expected US demand appeared to be offsetting sluggish buying in Europe, now in a debt crisis, supporting the idea of an “overall soft landing of the Chinese economy,” Ren said.
“The US economy is doing much better than initially thought,” Ren said. “If the US holds on, we don’t think it will be as bad as 2009. It won’t even be as bad as during the Asian financial crisis.”
Meanwhile, exports to the EU — China’s biggest trade partner — were up to US$30.98 billion last month from US$28.74 billion in October, customs data showed.
Ren said China could expect exports to continue to grow next year, just at a slower rate, “on the border of 10 percent.”
China’s overall imports expanded by 22.1 percent to US$159.94 billion last month, up from the US$140.46 billion recorded a month earlier, outstripping a 19 percent rise expected in the market as reported by Dow Jones newswires.
The robust trade data are in contrast with other official figures released on Friday that showed China’s economy lost steam last month.
Consumer prices rose at their weakest pace in more than a year and factory output growth hit its lowest level in more than two years, fueling pressure on Beijing to further relax credit restrictions to prevent a hard landing.
Analysts have said the weaker-than-expected data will raise concerns that economic woes in Europe and the US are hurting China’s economy and likely embolden policymakers to further open credit valves to spur activity.
However, Xinhua news agency said China’s top leaders had decided at a meeting on Friday to maintain a “prudent monetary policy” next year, suggesting they will move cautiously to ease credit restrictions.