China’s trade surplus surged to $101.9 billion in 2005, more than triple the $32 billion gap recorded the year before, according to customs figures.
Exports rose 28.4% year-on-year in 2005 to $762 billion, while imports rose 17.6% to $660 billion, the General Administration of Customs said in a report posted on its Web site.
With total global trade of $1.42 trillion, China is now the world’s third-biggest trading nation, the report said. China announced earlier that it had overtaken Japan in terms of merchandise trade and remained behind the United States and Germany.
The figures were largely in line with expectations, but they were likely to intensify pressure for Beijing to loosen foreign exchange controls that US officials and other critics contend keep the Chinese currency, the yuan, undervalued, making Chinese exports relatively cheap in overseas markets.
A leading US lawmaker, Sen. Max Baucus, said during a visit to Beijing that he had warned senior Chinese officials that the persisting trade imbalance with the US was bound to draw a backlash.
‘The imbalance simply exists. It’s there. It’s a fact, and it has to be dealt with. And it is a major irritant in US-China relations,’ said Baucus (D-Mont.), a member of the powerful Senate Finance Committee. ‘It is in China’s interest to make concrete progress in reducing the trade imbalance.’
China’s trade surplus with the United States in 2005 is forecast to top $200 billion, up nearly25 % from the record high surplus in 2004. The report issued Wednesday gave no breakdown for imports and exports with the United States and other major trading partners.
It said that China’s biggest trading partner was the EU, with two-way trade estimated at $217.3 billion, up 22.6% from the year before. The US was second, with imports and exports totaling $211.6 billion, up 25% year-on-year. Trade with Japan rose 9.9% to $184.5 billion.
The government forecast this week that growth in exports would slow significantly this year due to higher oil prices and trade friction.
The main planning agency, the National Development and Reform Commission, estimated in a report published in the state-run newspaper China Securities Journal that exports would rise about 15% year-on-year in 2006, with imports climbing about 18%.
Robust exports have been a key factor behind China’s feverish economic growth in recent years. The commission estimated that growth hit 9.8% in 2005, and says it is expected to slow to a still stunning 8.5% to nine percent this year.
The customs figures showed strong growth for China’s high-tech exports, which rose 32% year-on-year to $218.3 billion. Exports of electronics products also rose 32% on-year to $426.8 billion, accounting for 56% of the value of total exports for the year.
China’s consumer price index, its main measure for inflation, is expected to rise only one percent this year, and maybe yield to deflation later in the year, due to overproduction in many industries and slow domestic demand, the report said.
Autos, steel, cement and construction are among many industries facing a glut due to soaring investment in recent years. Aluminum smelters, also targeted for cutbacks, plan to cut annual output by 335,000 tons, or about 10% of total capacity, to counter excess production, the China Nonferrous Metals Industry Association said in a report on its Web site.
Meanwhile, the planning agency said China would spend at least 12 trillion yuan, or $1.5 trillion, in the next five years on energy and transport, areas severely strained by the breakneck pace of growth in recent years.
More than half will go to road and railway construction, the commission said in a report carried by the official Xinhua News Agency.