Exports contracted 8.7% in November from a year earlier, a sharper fall from a 0.3% loss in October and marked the worst performance since February 2020, official data showed on Wednesday. They were well below analysts’ expectations for a 3.5% decline.

Outbound shipments have lost steam since August as surging inflation, sweeping interest rate increases across many countries and the Ukraine crisis have pushed the global economy to the brink of recession.

The bleak data also underlined the impact of fresh Covid restrictions across many Chinese cities including manufacturing hubs Zhengzhou and Guangzhou as infections spiked last month.

Apple supplier Foxconn said that revenue in November dropped 11.4% year-on-year, after production problems related to Covid controls at the world’s biggest iPhone factory in Zhengzhou.

Freight rates index from Chinese ports to Europe and the US west coast were down by 21.2% and 21.0% in November from October respectively, according to the Shanghai Shipping Exchange, highlighting the weakening exports trend due to poor external demand conditions.

The widespread Covid curbs hurt importers too. Inbound shipments were down sharply by 10.6% from a 0.7% drop in October, weaker than a forecast 6.0% decline. The downturn was the worst since May 2020, partly also reflecting a high year-earlier base for comparison.

This resulted in a narrower trade surplus of US$69.84 billion, compared with a US$85.15 billion surplus in October. Analysts had forecast a US$78.1 billion surplus.

The government has responded to the weakening economic growth by rolling out a flurry of policy measures over recent months, including cutting the amount of cash that banks must hold as reserves and loosening financing curbs to rescue the property sector.

But analysts remain sceptical that the steps could achieve quick results, as Beijing has not announced a full reopening from Covid containment yet.

Almost three years into the pandemic, some local governments in recent days began to relax some lockdowns, quarantine rules and testing requirements that have exacted a heavy economic toll and caused widespread frustration and fatigue.

With the Chinese yuan already down sharply this year, policymakers’ room for manoeuvre is also limited as hefty monetary policy stimulus at home at a time of rapidly rising interest rates globally could trigger large-scale capital outflows.

The Ukraine war, which sparked a surge in already high inflation globally, has intensified geopolitical tensions and further undermined the business outlook.

China’s economy grew just 3% in the first three quarters of this year, well below the annual target of around 5.5%. Full-year growth is widely expected by analysts to be just over 3%.