China's exports extend slump in October: data

BEIJING: China’s exports fell at a faster pace than predicted in October, data showed Tuesday, as the world’s second-largest economy is buffeted by faltering global demand and a sluggish domestic recovery.

Beijing has sought to boost business activity in a country grappling with a major property crisis and weaker consumption since officials abolished their strict zero-Covid policy at the end of last year.

Exports — long a key driver of the growth — sank 6.4 percent year-on-year last month, according to the General Administration of Customs.

The reading was much worse than the 3.5 percent drop forecast in a Bloomberg survey of economists and slightly heavier than September.

Apart from a brief rebound in March and April, exports have been in constant decline since last October.

“Export growth remained sluggish as the economic momentum in the United States and Europe slowed,” said Zhang Zhiwei of Pinpoint Asset Management, adding that external demand was likely to remain weak in coming months.

Imports, however, rose 3.0 percent, bucking a forecast drop of 5.0 percent and notching the first month of on-year growth since late last year.

The rise in imports could be a signal that domestic demand in China is recovering from months of weakness.

But Zhang told AFP that the October “positive surprise” in imports alone is not sufficient to determine whether domestic demand is improving, pointing to other indicators such as retail sales.

“Nonetheless as fiscal policy has turned more proactive, a recovery in domestic demand is likely in coming months,” said Zhang.

China recorded moderate growth in the third quarter as Beijing looks to achieve its official goal of “around five percent” expansion for 2023 — one of its lowest targets in years.

Beijing said last month it would issue one trillion yuan ($137 billion) of sovereign bonds to boost infrastructure spending, and it has also introduced targeted stimulus for various sectors — particularly the ailing property market.

China slipped into deflation in July for the first time since 2021 but it bounced back modestly in August, though analysts warned a relapse in the coming months was still possible.