By AP with Doloresz Katanich
Published on
Customs data released on Friday showed a 1.1% drop in China’s global exports in October compared to a year earlier, the weakest since February, following an 8.3% increase in September.
This comes after President Donald Trump and Chinese leader Xi Jinping agreed last week to de-escalate the trade war between the two largest economies.
China’s shipments to the US have already fallen by double digits for seven consecutive months, while it has diversified its export markets to regions such as Southeast Asia and Africa. In October, the country reported a 25% drop in US shipments.
The overall export decline was also affected by a high base for the same month in 2024, when shipment growth soared more than 12.6%, the fastest rate in over two years.
Imports to China rose 1% last month from the year before, compared with 7.4% growth in September. Economists said a prolonged property sector downturn and weak domestic consumption remain a concern.
At their meeting in South Korea in late October, Trump and Xi agreed to lower tariffs and postpone new port fees they had imposed on each other’s vessels. China paused some of its export controls on rare earths for one year and agreed to purchase more soybeans and other farm products from the US. Washington, in return, eased some sanctions on Chinese companies.
Goldman Sachs economists said following the Trump-Xi meeting that they expect Chinese export volumes to grow by 5%-6% annually, helping China to gain global market share and driving its overall economic expansion.
“The reduction in some of these tariffs as part of the latest US-China trade ‘deal’ may provide a small boost to exports,” Leah Fahy and Zichun Huang, China economists at Capital Economics, wrote in a recent note. But that won’t show up until later in the last quarter of this year, they said.
A “meaningful” US export boost would probably start in the first quarter of next year and then accelerate in the second quarter, said Wei Li, head of multi-asset investments at BNP Paribas Securities (China).
This week, Chinese Premier Li Qiang told business leaders at the annual China International Import Expo in Shanghai that China would “embrace free markets and free trade,” while he criticised trade restrictions that hurt developing countries.