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China's trade surplus to fall this year, economic upturn to continue: central bank

2010-04-24 15:28 BJT

BEIJING, April 23 (Xinhua) -- China's trade surplus this year will see a decline from the 2009 level despite a recovery in foreign trade, the People's Bank of China, the central bank, said here Friday.

An increase in orders would push up export growth to more than 20 percent in the second quarter, while import growth would also stay high due to surging domestic demand and rising import prices, said the bank in a report released on its website.

"Exports have returned to pre-crisis levels and imports have hit all-time highs after seasonal adjustments," it said.

The report said China still faced deteriorating trade conditions with rising trade protectionism and the unstable global economic recovery.

China's trade surplus stood at 196 billion U.S. dollars last year. March saw its first monthly trade deficit in six years, with exports at 112.11 billion U.S. dollars and imports surging 66 percent to 119.35 billion U.S. dollars.

The country's macro-economy would continue to improve after a better-than-expected 11.9 percent economic growth in the first quarter, said the report, adding, "The Chinese economy has had a good start this year.

"Companies are more willing to invest, while the people are showing stronger consumption demand," it said.

Investment structure had been improved in the first quarter, with private investment rising 30.4 percent year on year, exceeding the 21.1-percent growth of government or state-owned enterprise investment, said the bank.

China's retail sales surged 17.9 percent year on year in the first quarter, and fixed assets investment rose 25.6 percent, data from the National Bureau of Statistics showed.

The bank also noted that "credit controls have seen initial results", as new yuan-denominated loans fell to 2.6 trillion yuan in the first quarter, 1.98 trillion yuan less than the corresponding period last year.

The government has stated that the proactive fiscal policy and relatively easy monetary policy would continue this year, while repeatedly warning of assets bubbles, inflation risks and overheating industries.

Soaring commodity prices were one of the government's major concerns, as the consumer price index, the main gauge of inflation, rose 2.4 percent year on year in March, nearing the government's upper limit of 3 percent inflation this year.

The bank said it would continue to strengthen liquidity management and keep an "appropriate" growth of money supply, so as to maintain stable prices and strike a balance between maintaining economic growth, adjusting the economic development model and avoiding inflation risks.

Editor: Zhang Ning | Source: Xinhua