Nevertheless, this performance is compared against a low base from the previous year when authorities adhered to a strict zero-Covid policy, adversely impacting output and business activity. Additionally, a surprising decline in imports underscores weak consumer activity within China.
Overseas shipments saw a modest increase of 0.5 percent year-on-year, reaching $291 billion, according to the General Administration of Customs (GAC). This marks the first positive growth since April, surpassing analysts' expectations and rebounding from a 6.4 percent drop in October.
Zhiwei Zhang, President and Chief Economist at Pinpoint Asset Management, noted that while there is a "sequential growth" in exports, it remains uncertain whether they can serve as a substantial growth driver in the coming year. Zhang emphasized the need for China to rely on domestic demand as the primary driver for growth in 2024, particularly considering the cooling economies of Europe and the United States.
Chinese exports, a historic growth catalyst, have experienced a decline since October of the previous year, with only a brief recovery in March and April. Shipments to the United States and the European Union notably dropped, while exports to Russia surged, showcasing China's economic ties with its ally despite geopolitical tensions.
On the other hand, imports contracted by 0.6 percent to $224 billion in November, signaling a return to contraction. Despite a surprising growth in October, this decline suggests a continued weak recovery trend in China, exacerbated by challenges such as a debt-fueled property crisis and subdued consumption.
China's third-quarter economic expansion of 4.9 percent, slightly below Beijing's five percent target, underscores the challenges in sustaining recovery amid global uncertainties and domestic economic issues. The recent Moody's downgrade of China's credit rating outlook to "negative" reflects concerns about rising debt and the potential impact on fiscal, economic, and institutional strength.
Ting Lu, Chief China Economist at Nomura, highlighted that the property market remains a significant drag on China's economy, and despite recent stimulus measures, it may be premature to anticipate a turnaround.
