China Trade Surplus Narrows to $160 Billion in 2011
Shanghai. China’s trade surplus narrowed to around $160 billion in 2011, the commerce minister said on Thursday, as the world’s number two economy faced weaker demand from key export markets.
The drop from a 2010 trade surplus of $183 billion came after a year of economic turmoil in key export markets including the United States and Europe.
Commerce Minister Chen Deming said total trade volume — imports and exports combined — rose more 20 percent to $3.6 trillion last year, according to the official Xinhua News Agency, which gave no breakdown for exports and imports.
China’s trade surplus is politically sensitive, since the United States and other countries have accused Beijing of keeping its yuan currency artificially low to boost exports.
US officials have long charged that China was deliberately pursuing a weak currency, helping fuel a flow of cheap exports that helped send the US trade deficit with China to more than $270 billion in 2010.
Chinese leaders have pledged to boost domestic demand to counter slowing exports, a key driver of the country’s economic growth.
Chen said last month China would move to “stabilize” its exports in 2012, in the face of slowing demand due to the debt crisis and economic turmoil in the industrialized world.
A Chinese government researcher also said last month that export growth would slow sharply this year, which could drag the country’s annual economic growth below nine percent for the first time in more than a decade.
In a bid to boost economic growth and counter the slowdowns in Europe and the United States, authorities in December cut the amount of money banks must hold in reserve for the first time in three years.
The US Treasury said last month that China’s yuan is still significantly undervalued, although it refrained from saying Beijing manipulates the currency, which could lead to retaliatory action by Congress.
China defends its exchange rate regime, saying it is moving gradually to make the yuan more flexible.
China’s commerce ministry said Wednesday that foreign trade was forecast to grow at an annual rate of 10 percent to reach $4.8 trillion by 2015, as it issued development goals for the next four years.