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China posts vast trade deficit in Feb

China posts vast trade deficit in Feb

Updated: 2012-03-10 19:33


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BEIJING - For the first time in a year, China recorded a trade deficit of $31.48 billion in February, the largest in a decade, as import growth far outpaced exports.

Exports rose by a six-month-high of 18.4 percent from a year earlier to $114.47 billion in February, while imports were up 39.6 percent, the highest growth in 13 months, to $145.96 billion, customs data showed Saturday.

The relatively fast nominal expansion was fueled by the lower comparative base for last February, when the Chinese Lunar New Year holiday cut working days from the month and skewed trade data, the General Administration of Customs (GAC) said. The week-long holiday fell in January this year.

After seasonal adjustments, the annual growth of exports slowed to 4 percent in February, while that of imports was cut down to 9.4 percent.

Exports this January fell 0.5 percent from a year earlier, the worst slowing in more than two years, and imports fell even more sharply, plunging 15.3 percent.

The country's foreign trade rose 7.3 percent year-on-year to $533.03 billion in the first two months, with a combined trade deficit of $4.25 billion, the GAC said.

China's trade with the European Union, its largest trade partner, grew 4.7 percent year-on-year in the January-February period to $79.8 billion. However, China's sales to the Eurozone slid 1.1 percent in the first two months year-on-year.

In February, the United States, the nation's second-largest trade partner, replaced the EU as China's largest export market, as monthly sales to the US outnumbered that to the EU.

China's trade with the US gained 9.2 percent year-on-year to $66.05 billion.

Beset by global economic troubles, rising domestic labor costs and tightening policies at home, China is expecting a slowdown in foreign trade this year.

The Eurozone debt crisis has weighed heavily on Chinese trade policymakers. Since the region accounted for about one-sixth of the country's export market last year, problems there will continue to constrain China's sales abroad.

The government has targeted an annual rise of around 10 percent in foreign trade this year, tumbling from a 22.5-percent increase registered in 2011.

The target will be attainable, but will require "arduous efforts," Minister of Commerce Chen Deming said Wednesday on the sidelines of the country's annual parliamentary session.

Liu Ligang, director of the economic research department of ANZ Greater China, was cautiously optimistic about the country's export outlook this year, saying export growth may rally, buttressed by the government's supportive policies and stabilizing external conditions.

"Today's data, along with a slew of other indicators announced previously, suggests the world's second-largest economy is heading for a soft-landing," Liu said.

He expected China's GDP to rise 8.6 percent year-on-year in the first quarter of this year, slightly lower than the previous quarter's 8.9-percent growth.

According to statistics released Friday, the country's consumer inflation cooled to a 20-month low of 3.2 percent in February. The annual growth of its industrial value-added output also eased to 11.4 percent in the first two months, down from 12.8 percent in December last year.