China commerce minister cautious on export growth

BEIJING, April 24 (BestGrowthStock) – China’s exports are
recovering but with demand still sluggish in Western nations,
growth is unlikely to reach pre-financial crisis levels this
year, Commerce Minister Chen Deming said on a visit to a top
trade fair.

Chen said there were fewer U.S. and European buyers at the
Canton Fair than in the past, reflecting the slow revival of
consumption in countries hit hard by the credit crunch.

Many of the buyers were also just restocking and making
short term orders, against a backdrop of wariness about the
recovery of markets and trade conditions, according to a report
of Chen’s comments on the Commerce Ministry website.
(www.mofcom.gov.cn)

There are lingering fears of protectionism in both Beijing
and Washington, which have been exacerbated by a flurry of
recent moves in long-standing trade disputes between the two.

“Chinese exports are expected to achieve better results
than last year, but the growth pace won’t be very fast,” the
official Xinhua agency quoted Chen saying at the fair.

“This fair is better than the spring and autumn sessions
last year. A majority of exporters reported growth in orders
from overseas customers,” he added. Export orders rose 16.2
percent in the autumn session compared with spring levels.

China’s leaders have said they want to be sure that exports
have made a sustained recovery before unwinding anti-crisis
policies, including a freeze of the yuan’s exchange rate
against the dollar (CNY=CFXS: ) imposed in July 2008.

The Commerce Ministry, as a staunch defender of Chinese
exporters, is at odds with the People’s Bank of China over
whether the government should abandon the defacto peg.

The central bank, which would like a firmer currency to
dampen inflation, said in a report on Friday that the country’s
economy has made a good start to 2010 and the outlook for
exports and imports in the second quarter is bright.

After adjusting for seasonal factors, exports have
basically recovered to the pre-crisis level and with the global
economy recovering, export orders and other indicators point to
growth of more than 20 percent in the second quarter, the PBOC
said.

China in March recorded its first monthly trade deficit in
six years, but a customs official called the shortfall a blip,
mainly reflecting strong imports of oil, raw materials and
cars.

Significantly, the level of both exports and imports was
higher than in March 2008, before the global credit crunch
reached a climax.

But the Ministry of Industry and Information Technology
warned this week that a big rise in the yuan would badly hurt
Chinese exporters and could lead to a rise in unemployment.

China commerce minister cautious on export growth