China likely to maintain trade surplus in 2011

Posted on May 4, 2011 in AllEconomic News
Despite a small trade deficit in the first quarter of 2011, China is estimated to maintain a trade surplus in 2011 because of a complicated foreign trade situation, Jiang Yaoping, vice-minister of commerce, said on May 3. However, the share of the trade surplus in terms GDP will continue to drop and China’s foreign trade will develop in a more coordinated and balanced manner. Jiang made the remarks in Beijing on May 3 during a press conference concerning the 13th China Hi-Tech Fair. Data from the General Administration of Customs shows that China recorded a trade deficit of 1 billion U.S. dollars in the first quarter, the first quarterly deficit in six years. In response, Jiang said that China’s foreign trade shows a positive development trend, particularly strong import growth with monthly import value frequently setting new highs. During the first quarter, the import growth rate was 6 percentage points higher than the export growth rate, which was the key reason for the occurrence of the trade deficit. The rapid import growth in the first quarter resulted from the rise in the international prices of commodities such as crude and refined oil and iron ore as well as China’s stable and rapid economic development, growing consumer spending and continuous consumer upgrade. Jiang said that China’s current exports and imports are basically balanced and China’s foreign trade is estimated to maintain a surplus in 2011 because of the complicated trade situation at home and abroad. However, the share of the trade surplus in GDP will drop and China’s foreign trade will develop in a more coordinated and balanced manner. When talking about the 13th China Hi-Tech Fair scheduled to take place from Nov. 16 to Nov. 21 in Shenzhen, Jiang noted that the fair this year will focus even more on the exhibition of cutting-edge technologies and innovative high-tech products from different countries so as to boost mutually beneficial international exchanges and trade cooperation. It shows that the Chinese government has been striving to balance its foreign trade through the expansion of imports.

Jiang explained that China is accelerating the transformation of its foreign trade development pattern, while optimizing the trade structure. Two measures have been taken to expand imports. The first measure is to introduce new policies to boost imports and promote trade balance. The second measure is to further improve the import structure to promote import facilitation.

2011 marks the 10th anniversary of China’s entry into the WTO. Jiang said that China has made considerable achievements in the trade of high-tech products over the past 10 years.

The combined value of the country’s high-tech imports and exports increased more than eightfold from nearly 110.6 billion U.S. dollars in 2001 to nearly 905.1 billion U.S. dollars last year.

The number reached 222.8 billion U.S. dollars in the first quarter of 2011, up nearly 21 percent from a year earlier.

Furthermore, China’s imports grew faster than exports in the first three months of the year, indicating that China has made great efforts to increase domestic demand, expand imports and introduce cutting-edge technologies from other countries.

via China likely to maintain trade surplus in 2011 – People’s Daily Online.