(Yicai Global) Dec. 9 – Although China's overseas demand picked up in November and exports rose substantially, the trade surplus in the fourth quarter could prove a drag on GDP, said China International Capital Co. (CICC), China's first joint venture investment bank.
In US dollar terms, China's exports reached USD196.80 billion in November, up 0.1 percent from a year ago, compared with a year-on-year decline of 7.3 percent in October, according to November trade data released by China's General Administration of Customs yesterday.
In yuan terms, China's exports were CNY1.32 trillion in November, up 5.9 percent from a year earlier. Imports stood at CNY1.03 trillion, up 13 percent year-on-year. The trade surplus reached CNY298.11 billion, a decrease of 12.9 percent from last year.
However, China's trade surplus declined in November as imports also increased significantly. Trade surplus reached USD44.61 billion last month, down from USD49.06 billion in October and down 17.4 percent from the same period last year. Despite the pick-up in exports, the contribution of the trade surplus to GDP could still be negative in the fourth quarter, CICC said.
China's imports reached USD152.19 billion in November, an increase of 6.7 percent from a year ago, as opposed to a year-on-year decline of 1.4 percent in October.
China's leading export index hit 36.9 last month, 1.3 higher than in October. This is consistent with the improvement in the manufacturing PMI export orders index, indicating that pressure on exports is likely to drop early next year. Overall, there are signs of a pick-up in overseas demand, the CICC said. It expects the decline in exports to narrow further in the fourth quarter. However, global trade still faces challenging uncertainties as Trump may pursue protectionist trade policies after taking office as president.