China’s exports handily beat forecasts in November, adding to recent evidence of a stabilization in the world’s second-largest economy as its leaders embark on an ambitious restructuring plan.

Exports rose 12.7 percent from a year earlier, the Customs Administration said on Sunday, against a median forecast in a Reuters poll of a 7.1 percent rise.

Imports rose 5.3 percent, below a forecast of 7.2 percent, leaving a trade surplus of $33.8 billion against forecasts for $21.7 billion.

“There are signs that the global activity and trade cycle is gaining momentum, driven by the recovery in high income countries, and China’s exporters are benefiting from that,” Louis Kuijs, economist at RBS, said in a note.

The strong export figure comes as a boost after exports have been a drag on the economy so far this year, subtracting 1.7 percent from growth in the first three quarters.

Weak global demand, a stronger yuan currency and rising labor costs have taken their toll on sales of Chinese goods abroad. But there are hopes of a sustained pick-up in global demand.

Exports directly create about 30 million jobs and add another 100 million in related industries, according to official estimates.

Some economists noted, however, that the figures may have been influenced by hot money inflows disguised as trade deals, a problem that had distorted trade figures earlier in the year.

“As China’s economic fundamentals stabilise and reform pushes on, the better prospects are attracting massive hot money back,” said Li Huiyong, analyst at Shenyin Wanguo Securities.

“Generally, hot money flows are seen through lower imports and higher exports, and the less than expected imports in November and higher than expected exports precisely illustrate this point.”

On Saturday, the official Xinhua news agency reported that regulators would clamp down on banks’ and companies’ use of foreign currency for trade finance by ensuring that trade deals are authentic.


China’s leaders want the traditional growth drivers of heavy investment and brisk export sales to make way for a more sustainable expansion in consumption and have unveiled the boldest economic and social reforms in nearly three decades to pursue that goal.

Recent data has shown a stability in the economy, creating the base needed for the reforms to go ahead. Four separate purchasing managers’ indices (PMIs) last week had pointed to growth in the factory and services sectors, with export orders showing resilience.

The picture was more mixed on domestic demand in the PMIs, however, and the import data for November may also indicate that domestic demand is yet to really take off.

Attention is now on inflation and economic activity figures due on Monday and Tuesday, which will give a fuller picture of the overall health of the economy in November.

Factory output growth is seen slipping to a four-month low of 10.1 percent in November, according to a Reuters poll. Inflation is seen unchanged from October’s eight-month high of 3.2 percent and below the central bank’s 3.5 percent target for 2013.

The government is expected to decide its 2014 economic growth target at this month’s Central Economic Work Conference, the date of which has not been announced. Some experts have called for it to be cut from this year’s 7.5 percent.