Economy
China hit by 1st trade deficit in 6 yrs
(Xinhua)
Updated: 2010-04-10 11:14
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BEIJING - China's trade balance turned red in March, the country's first monthly trade deficit in six years, the General Administration of Customs (GAC) said here Saturday.
China exported 112.11 billion U.S. dollars of goods and services in March, up 24.3 percent year on year, while the imports surged 66 percent year on year to 119.35 billion U.S. dollars, resulting in a trade deficit of 7.24 billion U.S. dollars.
The March deficit was China's first since it posted a 2.26 billion deficit in April 2004, according to a report released by the GAC.
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Taking the first three months together, China's Jan-March imports and exports rose 44.1 percent to 617.85 billion U.S. dollars, still posting a trade surplus of 14.49 billion U.S. dollars in the first quarter though it was sharply down 76.7 percent from the same period of last year.
The GAC attributed the March deficit to shrinking exports of labor intensive products, surging imports volumes and rising commodity prices.
"Neither is the deficit in March a recession, nor can it sustain," the GAC said in its report, adding the deficit was small and China has maintained a "basic balance" between imports and exports.
The GAC said the deficit accounted for only 3.1 percent of total imports and exports in March, a proportion much lower than the alarm level of trade imbalance at 10 percent.
"The March deficit stemmed mainly from the fast growth of imports by China amid its efforts to increase imports against the backdrop of global economic downturn," the GAC said. "And China's efforts (to expand imports) helped with the recovery of world economy and demonstrated its role as a responsible country."
The GAC predicted China's trade surplus might continue to scale down and keep a trade balance in the rest of the year.
According to the GAC figures, China's trade surplus with the United States dropped 3.5 percent year on year to 9.87 billion U.S. dollars in March and that with the European Union also fell 13.1 percent to 6.96 billion U.S. dollars.
However, China's trade deficit with Japan surged by more than three times over the same month of last year to 6.53 billion U.S. dollars while its deficit with Republic of Korea jumped 76 percent to 6.13 billion U.S. dollars in March.
The establishment of the ASEAN-China Free Trade Area on January1, 2010 greatly boosted China's trade with the bloc, with ASEAN's trade surplus with China skyrocketing to 2.7 billion from 300 million U.S. dollars last year.
The Chinese mainland's deficit with Taiwan amounted to 7.9 billion U.S. dollars in March, up 78.7 percent year on year.
