China's exports rise 5.9% in November despite US shipments falling sharply

China's exports bounced back in November after a surprising decline in October, although shipments to the United States fell nearly 29% year-on-year for the eighth consecutive month of double-digit drops.

Customs data released today (8 December) showed overall exports grew 5.9% in dollar terms to $330.3 billion, surpassing economists' expectations. This followed a 1.1% contraction in October. While exports to the US remain weak, shipments to other regions, including Southeast Asia, Africa, and Latin America, have surged.

China's imports also rose 1.9% in November, an improvement over October's 1% growth, despite ongoing pressure from the property sector affecting consumer spending and business investment.

The growth follows a year-long trade truce between China and the US, reached during a late-October meeting in South Korea between President Donald Trump and Chinese leader Xi Jinping. As part of the truce, the U.S. reduced tariffs on Chinese goods, and China agreed to halt certain export controls on rare earths.

"While the trade truce and US tariff reductions should support Chinese exports, we are entering a period of unfavorable base effects," wrote ING Bank economists Lynn Song and Deepali Bhargava, noting strong export growth last year ahead of Trump's tariff hikes. "This should keep trade growth modest."

Despite exports holding up, China's factory activity contracted for the eighth consecutive month, and economists say it is too early to determine whether the trade truce has sparked a real rebound in external demand. Analysts generally expect China to meet its annual growth target of around 5% this year.

Chinese leaders recently outlined plans to focus on advanced manufacturing over the next five years, with details expected at an upcoming economic planning meeting. However, BNP Paribas strategist Chi Lo warned that a stable global trade environment is unlikely, given the ongoing stalemate in China-US relations.

Still, some economists are optimistic about China's long-term export prospects. Morgan Stanley forecasts that by 2030, China's share of global exports could rise to 16.5% from about 15% today, driven by strengths in advanced manufacturing and high-growth sectors such as electric vehicles, robotics, and batteries.

"Despite trade tensions, protectionism, and active industrial policies in G20 economies, we believe China will continue gaining share in the global goods export market," said Morgan Stanley Chief Asia Economist Chetan Ahya.