China's Trade Surplus Decline Suggests Less Reliance on Exports
By SHARON LAFRANIERE and BETTINA WASSENER
New York Times
January 9, 2011
BEIJING — The Chinese trade surplus shrank in 2010 as a share of gross domestic product for the third year in a row, a sign, some experts said, that its booming economy was slowly becoming less dependent on exports to drive growth.
The trade surplus data were released Monday, little more than a week before President Barack Obama and his Chinese counterpart, Hu Jintao, were to meet in Washington. The United States has been pushing China to strengthen the value of its currency against the dollar, arguing that the renminbi is kept artificially weak to raise Chinese exports. A stronger renminbi, economists say, would make imports cheaper, increase domestic consumption and help rebalance the Chinese economy.
The trade surplus declined nearly 7 percent to $183.1 billion in 2010, according to the Chinese customs agency.
Economists cautioned that a 41 percent jump in the value of imports reflected higher prices for commodities last year, and not greater domestic consumption. Several analysts predicted that the surplus would climb back this year to about $200 billion.
Nonetheless, the continued shrinking of China’s trade surplus as a share of G.D.P. — down from a high of nearly 11 percent in 2007 to 3 or 4 percent last year — suggests that China’s economy is increasingly consumer-driven.
Auto sales in China during 2010, announced Monday by the China Association of Automobile Manufacturers, gave another indication of strengthening internal demand. Sales of passenger vehicles rose 33 percent from the level of the previous year to 13.76 million, according to Xinhua, the state-run news agency, citing the association as its source.
“There is some sign of rebalancing,” said Tao Wang, an economist at UBS Securities.
Over all, China’s exports rose 32 percent in 2010, reaching a record level. Analysts said that figure showed that Chinese goods remained intensely competitive, despite China’s decision in June to allow the renminbi to strengthen slowly.
China insists that the renminbi exchange rate is not the main cause of the trade imbalance with the United States and that export restrictions imposed by the United States add to the disparity. China’s trade surplus with the United States totaled $181 billion last year.
That is just $2 billion shy of China’s entire trade surplus with all its trading partners worldwide, according to Moody’s Analytics.
China allowed its currency to strengthen 3 percent against the dollar last year, a trend that many economists predict will continue as the government strives to hold down rising inflation. Li-gang Liu, China economist at Australia & New Zealand Banking Group in Hong Kong, estimated the renminbi would gain as much as 5 percent against the dollar this year.
Data released for December showed that China’s exports had risen 17.9 percent from the same period the year before, while imports had gained 25.6 percent. The $13 billion monthly trade surplus was smaller than predicted, and nearly $10 billion less than the $22.9 billion trade surplus posted in November. Analysts said the drop reflected a seasonal pattern, not a general trend.
“I don’t think one month’s data changes anything either way,” said Jinny Yan, an economist at Standard Chartered Bank in Shanghai.
Bettina Wassener reported from Hong Kong.
nytimes.com |
