In November, Chinese exports grew for the first time in six months – by 0.5%

In November, Chinese exports grew for the first time in six months – by 0.5% year-on-year, to $291.9 billion, according to Chinese customs data, although analysts expected a decline of 1.1%. In October, exports, we recall, decreased by 6.4%. However, it is apparently too early to talk about a revival of external demand – the reversal of dynamics can be explained by the fact that large businesses began to gradually reduce prices for products supplied to foreign markets in order to increase supply volumes. In particular, Chinese supplies to the United States in November increased by 7.3% year on year. We note, however, that the countries’ trade turnover is increasingly affected by their economic confrontation, caused, among other things, by the signing of the anti-inflation law by US President Joe Biden. For example, yesterday, after the publication of new American rules for subsidizing the production of electric vehicles, the Chinese Ministry of Commerce accused Washington of discriminating against Chinese suppliers.

Imports to China in November, on the contrary, decreased by 0.6% (see chart) – to $223.5 billion, contrary to the forecasts of experts who expected it to grow by 3.3%. A month earlier, the import of goods into China increased by 3% year-on-year, which was perceived as a signal of a revival of domestic demand, caused, among other things, by the promises of the People’s Bank of China to reduce rates (see Kommersant on November 8). Let us explain that we were talking about the regulator’s policy in the long term – following the meeting of the country’s central bank on November 20, rates were left unchanged. The decline in imports in November indicates that domestic demand appears to be recovering subdued for now. Customs statistics also indicate a decrease in imports of goods from the United States – by 15.1% year-on-year – with a slight increase in imports from the European Union – by 1.6%.

Since the beginning of the year, China has most noticeably increased trade with Russia: during this period, the countries’ trade turnover reached a historical high of $218.2 billion. Thus, the plan to increase bilateral trade to $200 billion by 2024, which was previously announced by Vladimir Putin and Xi Jinping, completed ahead of schedule. Exports from China to the Russian Federation over the 11 months of 2023 increased by 50.2%, to $100.33 billion, imports – by 11.8%, to $117.84 billion. For comparison: at the end of 2022, trade turnover increased by 29.3 %, up to $190 billion, at the end of 2021 – by 35.8%, up to $146.88 billion.

Kristina Borovikova