Chinese Exports Continue to Tumble As Economic Troubles Grow
November 8, 2023
China’s economy continues to struggle as exports fell for the sixth straight month, adding additional pressure for Beijing to boost spending at home as climbing global interest rates and wars in Ukraine and the Middle East weigh on the global economy.
Chinese exports fell 6.4% in October compared with a year earlier, to $275 billion, China’s General Administration of Customs said Tuesday. That is a steeper decline than September’s 6.2% fall and significantly above the 3.5% contraction that economists polled by the Wall Street Journal had anticipated.
Demand for Chinese goods is subdued as consumers and businesses throughout the globe contend with slowing growth and higher borrowing costs. The slowdown is not unique to China. Other Asian exporters like South Korea and Taiwan have also seen declining exports in recent months.
The International Monetary Fund (IMF) expects global economic growth to slow this year and next, as the impact of central banks’ aggressive interest-rate increases takes its toll. Most economists now expect the U.S. to avoid a recession but anticipate a slowdown in the coming months.
For China, weaker exports will put more pressure on domestic spending to keep the economy growing, but boosting domestic consumption has been a challenge for Beijing. Real estate investment continues to decline as the nation’s beleaguered property development sector continues to falter, and Chinese consumers continue to keep a tight leash on spending as they try to weather the real estate downturn.
The Chinese government has enacted a slew of stimulus measures in recent months after second-quarter growth slowed to a crawl. These measures led to a small rebound in the third quarter, and the IMF estimates that China will see GDP growth of 5.4% this year, but economists are wary of how the world’s second-largest economy will perform over the long run.