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The export situation in December is better than the future.
In response to the sharp rise in China's foreign trade and exports in November, Shen Danyang, spokesperson for the Ministry of Commerce, highlighted during a regular press conference on the 18th that the growth is largely attributed to the policy-driven momentum since the second half of the year, as well as positive developments in both domestic and global economic conditions. This combination of factors has led to a strong performance in exports, which are expected to remain robust in December. However, he cautioned against excessive optimism.
According to customs data, China's total foreign trade value rose by 9.3% in November, with exports reaching $202.2 billion—marking the first time the monthly export figure surpassed $200 billion. This represents a 12.7% increase compared to the same period last year, setting a new record.
Shen Danyang outlined three key reasons behind the surge: first, the recovery in developed economies and the impact of Christmas orders; second, the continued effectiveness of policies aimed at boosting trade; and third, the relatively low base from the previous year.
Lu Zhengwei, chief economist at Industrial Bank, noted that the rapid export growth has contributed to the renminbi’s appreciation, leading to more optimistic forecasts for the economy in the first quarter of this year. In Q1, foreign trade boosted GDP growth by 1.1 percentage points, while it only added 0.1 percentage points in Q2 and Q3. He attributed this discrepancy to the overvaluation of the yuan’s real effective exchange rate, which creates conditions for arbitrage activities. When exchange rate fluctuations are minimal, speculative capital flows into China through trade channels.
A recent survey by the Ministry of Commerce involving over 1,900 key foreign trade enterprises revealed that the export confidence index in November was exactly 100. While this marks an increase of 1.1 percentage points from the previous month, it remains near the critical threshold, indicating that businesses remain cautious about future export prospects.
Looking ahead, Lu believes two key factors will support improved export performance next year. First, the Central Economic Work Conference emphasized the role of exports in supporting economic growth—a shift from past statements that focused more on quantity than quality. In the future, export policy will likely prioritize structural adjustments. Second, the global economy is expected to continue its recovery.
However, Lu also pointed out that the severely overvalued RMB exchange rate remains a challenge in developing new export advantages and expanding trade. Additionally, the world is nearing the end of a global trade recovery cycle, which could pose further challenges for exports next year. He warned about the risk of trade misjudgment caused by inflated trade figures driven by speculative capital. The only long-term solution, he said, is to address the overvaluation of the RMB.
In response, Lu called for an expansion of the daily trading band for the renminbi against the U.S. dollar and the central parity rate, aiming to tackle the issue of inflated trade at its root.