China Confident of 10% Export Growth This Year
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Despite the economic slowdown in China and its key trading markets such as the eurozone and the United States, China’s trade ministry says it has seen some “satisfying” indications of a trade rebound, after it posted a massive $31.5 billion trade deficit in February.
At a press briefing in Beijing today, spokesman for the Commerce Ministry Shen Danyang said preliminary trade data for June was “pretty good” and has “kept the pace seen in May” when trade shipments were more than double what analysts had forecasted.
Despite the economic slowdown in China and its key trading markets such as the eurozone and the United States, China’s trade ministry says it has seen some “satisfying” indications of a trade rebound, after it posted a massive $31.5 billion trade deficit in February.
At a press briefing in Beijing today, spokesman for the Commerce Ministry Shen Danyang said preliminary trade data for June was “pretty good” and has “kept the pace seen in May” when trade shipments were more than double what analysts had forecasted.
According to Shen, China’s exports and imports are still growing within expectations, and the Ministry is confident of achieving a 10 percent trade expansion provided there is no “dramatic” deterioration in the world economic situation.
China’s economic growth in the past decade has become heavily dependent on exports and investment and faltering global demand has exposed the vulnerabilities and gaps in the Chinese economy.
The world’s second largest economy posted a massive $31.5 billion trade deficit in February this year – the largest trade gap in 22 years – following an economic contraction in Europe, the biggest importer of Chinese goods.
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While that contraction, largely a seasonal trade distortion, was quickly reversed in March, China’s exports have missed the 10-percent target in three out of the five months this year.
Furthermore, China’s export growth is running at half the pace of last year.
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As Reuters commented:
[quote] The Chinese government is sensitive to plummeting exports sales as the export sector is China’s largest employer and a sharp economic downturn could throw millions of workers out of jobs and heighten the risk of social unrest. [/quote]
However, the Chinese government has been proactively expanding its trade network beyond its traditional markets in the West.
To date, China has signed 9 free-trade agreements (FTA) while another 9 agreements are under negotiation and consideration.
In the latest development of China’s FTA network, Chinese premier Wen Jiabao, who is on an official visit to Buenos Aires, said yesterday that China is considering a free-trade pact with Mercosur, the Latin America trade bloc.
In 2011, China’s exports to the Mercosur, totalled $48.45 billion, up 34 percent from the previous year, while imports from Mercosur reached $51.03 billion, according to Argentine government figures.
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