Even when China's foreign trade hit a historic high in November, boosted by rising demand ahead of the Christmas shopping season, economists forecast a bumpy road next year.
China's exports rose 34.9% year on year in November to 153.33 billion U.S. dollars while imports jumped 37.7% to 130.43 billion U.S. dollars, the General Administration of Customs (GAC) said Friday.
Exports and imports totalled 283.76 billion US dollars last month - a new record high - compared with 273.09 billion dollars in September, the GAC said in a statement on its website. China’s trade surplus fell to 22.89 billion last month from 27.1 billion dollars in October, which was the second highest of the year after July's 28.73 billion.
The higher-than-expected exports were a result of seasonal factors, said Beijing-based Huarong Securities analyst Xiao Bo, referring to the increase in orders ahead of foreign countries' shopping seasons.
Chinese exports face a gloomy outlook next year, with increased pressure from the appreciation of the Yuan and trade frictions, said Zhang Yansheng, a researcher at the National Development and Reform Commission, China's top economic planner.
Making the situation worse, the rising cost of labour and raw materials and trade protectionism will further squeeze Chinese exporters' profit margins, Zhang said.
Xiao expects Chinese export growth to fall in early 2011 as imports increase at a steady pace, which will cause the nation's trade surplus to further shrink.
UBS Securities economist Wang Tao expects Chinese exports to climb 29% year on year this year but year-on-year growth to slow to 15.5% in 2011. According to customs statistics, in six of the first 11 months of the year, imports growth outpaced that of exports.
Such a situation will become normal in the future as China strives to restructure its national economy by weaning itself off its reliance on exports and boosting domestic demand, said Zuo Xiaolei, Galaxy Securities' chief economist.
China's foreign trade totalled 2.68 trillion US dollars in the first 11 months of the year, up 36.3% year on year, the GAC said.
The European Union remained China's largest trade partner, with EU-China trade increasing 33.1% year on year in the first 11 months to 433.88 billion US dollars. Trade with the US rose 30.2% year on year to 346.89 billion USD and with Japan, 31.7% to 267.79 billion.