China's exports rose for the first time since May. In November, exports increased by 0.5 percent in US dollars compared to the same month last year, as China's customs authority announced in Beijing on Thursday. Some analysts had expected little change or further declines. In October, exports were down 6.4 percent year-on-year.
There was a surprise when it came to imports. These fell by 0.6 percent. Experts had expected a significant increase after imports had already unexpectedly increased in October. At the time, this increase was seen as a sign of increasing consumption on the Chinese market. Imports to China are also important for German exporters.
Chinese exports to the EU and Germany fell by more than ten percent over the year. Imports from Europe and Germany also decreased. Europeans have long complained about unbalanced trade relations with the world's second-largest economy. EU Council President Charles Michel and Commission President Ursula von der Leyen discussed these problems during talks with China's government in Beijing on Thursday. In contrast, China's exports to Russia have been rising rapidly for months and were recently up around 50 percent for the year.
Many problems for China's economy
Observers had hoped that trade would stabilize. Internationally, things are not going well for the Chinese because global inflation and increased interest rates are depressing demand for products from the Far East. There are also no signs of any significant improvement in China's economy, which is putting pressure on decision-makers in Beijing. The real estate sector is in a serious crisis due to its indebted developers, and consumers in China are buying less. 2024 could therefore be difficult if analysts are right that China will have to rely on its domestic demand because the US and EU economies are cooling down.
In addition, the rating agency Moody's had lowered its outlook for China's creditworthiness. The country did not lose its A1 rating, which marks it as a safe investment. However, China's Finance Ministry was disappointed and said the concerns were unfounded. According to US analysts, financial aid for indebted local governments and state-owned companies as well as the real estate crisis are likely to weigh on China's economy. Some estimates put the equivalent of $11 trillion in debt in Chinese cities and provinces.
Hardly any improvement in the real estate crisis
The situation on the real estate market remains difficult. China Evergrande, the most indebted company with the equivalent of more than 300 billion US dollars, had given itself another breath in court in Hong Kong at the beginning of the week. The developer is threatened with liquidation. Since 2021, the southern Chinese have repeatedly missed payments to foreign creditors who now want to get them back. The court wants to see a restructuring plan in January.
To strengthen the market, the government relaxed regulations on home purchases and loans. In smaller cities, however, new apartments are being sold more and more slowly, as the business magazine "Caixin" reported. At the end of October, it took an average of 26.3 months for sales in third and fourth tier cities. In July it was still 20 months away, as the magazine reported. In large cities such as Beijing or Shanghai, the time increased slightly from 11 to 12.7 months. According to Caixin, the government considers 12 to 18 months to be normal to sell an apartment.