China's Foreign Trade Expected to Grow 10 Percent This Year

China's foreign trade is expected to see a 10-percent growth this year, according to an article in the latest issue of the country's most authoritative news weekly, Outlook, coming on May 1.

In the first quarter, China's foreign trade was above expectations considering the slump in the economy since early last year. Official statistics showed a 40-percent jump, with gross imports and exports up to 98.2 billion U.S. dollars for the three months.

Of the total, exports increased 39 percent to 51.7 billion U.S. dollars and imports rose 41 percent to 46.5 billion U.S. dollars, leaving a trade surplus of 5.2 billion dollars.

China's healthy foreign trade can be attributed to several factors, says the article, which was written by Pei Changhong, a researcher at the Chinese Academy of Social Sciences.

The first factor is that growth was recorded compared with the slump in the same period last year when foreign trade grew only by 0.3 percent from 1998.

Second, continued improvement of the world economy is expected, which will help increase China's imports and exports. According to the International Monetary Fund, the global economy is forecast to grow 4.2 percent this year.

For the first two months, China's trade with its Asian partners grew by 46.8 percent on an annual basis. China's trade with the European Union, the United States and Canada grew at a rate of 41. 7 percent, 33.6 percent and 37.1 percent respectively.

Third, export-promotion measures taken by the central government since early last year have begun to produce desirable results, the article says.

Fourth, the sustained development of the Chinese economy helped expand domestic demand, which in turn led to increases in the country's imports.

In the first quarter of this year, China's gross domestic product (GDP) witnessed a growth of 8.1 percent, while retail sales grew 10.4 percent over the same period last year.

Official statistics indicated that China's imports grew 54 percent in the first two months of the year, though imports slowed a bit in the third month.

The article notes that if the above-mentioned factors don't change much for the rest of the year, China will see a year of relatively high growth in its foreign trade.

The author also cautions against being overly optimistic in the country's foreign trade, stating that there still exists uncertainties in the global and U.S. economies.

However, China's foreign trade is expected to hit two-digit growth. The growth rate of its exports is expected to exceed 10 percent while that of imports about 10 percent this year, with trade surplus estimated at more than 25 billion U.S. dollars.

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