China’s exports grew 6.7% in November, sharply down from October’s 12.7%, while imports unexpectedly contracted by 3.9%, marking their worst performance in nine months. These figures raise concerns about the health of the world’s second-largest economy, particularly as President-elect Donald Trump’s impending return to the White House signals fresh trade risks.
Fresh Tariff Threats from Trump Administration
Trump has pledged additional tariffs on Chinese goods, ranging from 10% to over 60%, to pressure Beijing on issues like fentanyl trafficking. These threats have rattled China’s industrial sector, which exports over $400 billion annually to the U.S. Early signs of exporters rushing to frontload goods to the U.S. in anticipation of these tariffs emerged in October and November, but a full impact is expected in the coming months.
Policy Shifts to Support Domestic Demand
China’s policymakers have vowed to ramp up stimulus in 2025, emphasizing accommodative monetary and fiscal policies. Economists are calling for a pivot from an over-reliance on manufacturing and exports to bolstering domestic consumer demand, as unresolved trade tensions with both the U.S. and the European Union threaten growth.
Trade Surplus Grows Amid Global Challenges
Despite the challenges, China’s trade surplus expanded to $97.44 billion in November, up from $95.72 billion in October. Analysts expect further export acceleration in the coming months due to competitive gains and exporters continuing to frontload goods ahead of potential tariffs.
Commodities and Domestic Market Prospects
Imports of commodities like vegetable oils, rare earths, and fertilizers fell, driven partly by lower global prices. However, volumes increased for crude oil, coal, and copper. Analysts anticipate a recovery in imports fueled by expanded fiscal expenditure and investment-focused policies.
Calls for Economic Diversification
Analysts recommend maintaining China’s growth target at around 5% for 2025 while leaning on the country’s vast domestic consumer market to mitigate external risks. Policymakers are expected to set key economic targets for the coming year during meetings this week, signaling a potential prioritization of the consumer sector over export-driven manufacturing.
