By Geoff Dyer in BeijingPublished: November 11 2008 20:51 

 Last updated: November 11 2008 20:51

China’s trade surplus grew to another record last month as the its exporters continued to show greater than expected resilience in the face of a global slowdown.

    The politically sensitive trade surplus, which already stood at record levels in September, grew a further 20 per cent last month to $35.2bn after a modest reduction in the growth rate of exports was accompanied by a sharper drop in import growth.

    The government also released further evidence on Tuesday of slowing domestic demand, including another drop in house prices and further softening in consumer price inflation.

    The new figures came as other countries in the region, including India, Japan and South Korea, reported significant falls in their export performance last month. 

    In Australia, where the economy has flourished on commodity exports to China, business confidence plunged to its lowest level since at least 1989 in the latest sign the country’s 17-year growth streak is about to end.

    National Australia Bank said confidence in its October survey fell a record 21 points to minus 29 points, lower than during Australia’s last recession in 1991.

    In the face of mounting evidence that economic conditions are deteriorating rapidly, China’s government announced on Sunday it would spend Rmb4,000bn ($586bn) over two years on infrastructure and social welfare, although it has yet to specify how much will be extra spending not already planned.

    The announcement was initially welcomed by investors but as fears about the economic outlook returned, Japan fell 3 per cent on Tuesday and Europe was led lower by Germany’s Dax sliding 5.3 per cent. In London the FTSE 100 declined 3.6 per cent as the pound slumped amid weak economic and earnings news.

    At midday in New York the S&P 500 was 3.3 per cent lower.

    Despite stories about hundreds of small export factories in southern China being forced to close down, China’s headline exports have so far not been hit.

    Some economists believe China’s exports might suffer much less damage than initially thought in a global recession because of their competitiveness.

    However, plenty of other economists believe the pain is only starting to be felt among exporters given that Europe is now slowing sharply and many emerging economies also face slumping demand. “China’s exporters face a torrid few months,” said Mark Williams at Capital Economics.Copyright The Financial Times Limited 2008