China reported higher-than-expected export growth in December

Containers stand at Yangshan Port in Shanghai, China, 6 August 2019.

Aly Song | Reuters

BEIJING – China’s exports rose more than expected in December but failed to offset an overall decline for 2023, customs data showed on Friday.

Exports rose 2.3% year-on-year in U.S. dollar terms last month, more than the 1.7% increase expected in a Reuters poll.

In 2023, exports fell 4.6%, while imports fell 5.5%, according to customs data.

Imports rose 0.2% in December from a year earlier in US dollar terms. That was slightly less than the 0.3% increase expected by analysts polled by Reuters.

Demand for Chinese goods fell due to slower global growth, and the country’s trade with its major partners fell in 2023.

The Association of Southeast Asian Nations was China’s largest regional trading partner in 2023, followed by the European Union.

Among countries, the US remained China’s largest trading partner.

Russia was a rare bright spot, with China’s exports to the country up nearly 47% in 2023 and imports up nearly 13%.

“Chinese manufacturers expect production to grow through 2024 on forecasts of firmer global demand, higher client spending and investment in new products,” Caixin said in a report for its December Manufacturing Purchasing Managers’ Index.

The index showed a slight improvement over November. “However, the level of optimism has moderated since November and remained below the series average.”

The report also noted a decline in the employment sub-index. “Firms often mentioned that they had decided not to replace those who left voluntarily or to cut staff as demand was more muted than expected,” the Caixin analysis said.

“Our baseline example is that exports will rise 2% in 2024 after a 5% decline (in 2023). If exports slow more than expected, politicians would become more active in terms of supporting domestic policy,” said Macquarie chief economist Larry Hu. report on January 5.

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Autos were a bright spot in China’s recent trade data. The country is expected to overtake Japan as the world’s largest auto exporter in 2023.

Rapid growth in the electric car market and demand from Russia have helped boost China’s auto exports, said Sarah Tan, an economist at Moody’s Analytics.

“After the Russian invasion of Ukraine in February 2022, many car manufacturers left the country, only for Chinese manufacturers to fill the gap,” she said in an email. “In the first eleven months of 2023, car supplies to Russia grew by roughly six times in value terms compared to 2022.”

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