China Growth in Focus as Exports and Imports Fall

BEIJING—China’s exports and imports fell in September as global demand remained weak, signaling that the world’s second-largest economy continues to struggle into the end of the year.

Exports dropped less than some economists had expected. Still, they said the data offered a further indication that China’s third-quarter growth figures set for release next week will likely fall below Beijing’s target of about 7% for the whole year.

“Exports in September look a little better than expectations,” said HSBC economist Ma Xiaoping, adding that year-end trade figures tend to pick up due to Christmas shipments. “But if you factor in seasonal factors, I don’t see much improvement in global demand,” she added.

According to the General Administration of Customs, Chinese exports fell 3.7% in September from a year earlier in U.S. dollar terms following a 5.5% drop in August. Imports in September fell 20.4% from a year earlier, compared with a 13.8% decrease in August, the customs agency said Tuesday.

The country’s trade surplus increased to $60.3 billion in September from $60.2 billion in August, the agency said.

China’s September exports continued to struggle against weak global demand. The International Monetary Fund expects the world’s economy to grow 3.1% in 2015, its slowest pace since the global financial crisis. That represents a downgrade from the IMF’s 3.3% growth forecast in July.

China’s exports were significantly better than in neighboring Taiwan and South Korea, both of which weathered a sharp export drop in September, signaling that China is holding its own in a weak market, economists said. “This shows the competitiveness of Chinese exports,” said Mizuho economist Shen Jianguang.

Huang Songping, a spokesman with the General Administration of Customs, said in a briefing that China’s exports are expected to return to growth in the fourth quarter after falling in the second and third quarters. The decline in Chinese imports is likely to narrow in the final quarter, Mr. Huang added, citing a raft of measures rolled out by Beijing in recent weeks, including easier procedures and reduced taxes aimed at improving trade.

Growth-hungry global economies have been concerned about China’s outlook after a stock-market slump and unexpected currency depreciation this summer rattled global markets. Beijing has cut interest rates five times since November, reduced required bank reserves repeatedly and stepped up government spending in a bid to boost growth, so far with limited results.

Chinese exports, once a primary growth engine for the economy, have faced more headwinds from higher labor and land costs and the rise of low-end competitors in Southeast Asia.

Economists said exports last month would probably have been stronger if it weren’t for an explosion at the northern port of Tianjin in August and the temporary closing of factories ahead of a September military parade in Beijing aimed at reducing air pollution.

China is likely to miss its 2015 foreign trade target of 6% year-over-year growth, down from the 7.5% growth targets it set in 2014 and 8% in 2013, both of which it failed to reach, economists said.

While Chinese imports have dropped sharply in recent months in dollar terms—tied in part to the yuan’s peg to the dollar and the declining cost of commodities such as crude oil and iron ore—the decline is much less sharp if measured in volume terms, economists say.

Tuesday’s export data are the latest in a parade of weak economic numbers out of China in recent weeks. The nation’s official purchasing managers index contracted in September for the second month in a row, foreign-exchange reserves fell by more than $40 billion last month and the real-estate industry continues to struggle.

In addition, China’s crude imports rose in September to 27.95 million metric tons, compared with 26.59 million tons in August. So far in 2015, crude imports are up 8.8% to about 249 million tons.