China's Exports Surge by 12.7% in October, Navigating Trade Tensions Successfully

China's Exports Show Strong Performance

In October, China witnessed a remarkable growth in exports, which rose by 12.7% year-on-year to reach US$309 billion, marking the fastest growth since July 2022, according to customs data released on Thursday.

This figure significantly outpaced the expected growth of 5.5%, reflecting a robust international demand for Chinese goods.

Trade Surplus and Import Trends

• Exports exceeded the 2.4% increase recorded in September.
• In contrast, imports declined by 2.3% year-on-year, compared to a 0.3% growth in September.
• This resulted in a notable trade surplus of US$95.72 billion in October.

Concerns Amid Changing Leadership

China's exports have shown consistent growth despite sluggish domestic demand. However, concerns have arisen following the presidential victory of Donald Trump. Analysts predict that his anticipated trade policies, which may include EU tariffs and potential tariffs of up to 60% on Chinese goods, could significantly alter the trade landscape.

According to Larry Hu, Chief China Economist at Macquarie Capital, "Trade war 2.0 could end China's ongoing growth model, in which exports and manufacturing have been the main growth drivers."

Trump's new policies could potentially reduce China's economic growth by 2 percentage points in the forthcoming year, pushing Beijing to escalate stimulus measures, particularly in the housing sector.

More to follow...