BEIJING, Dec 2: China’s billowing trade surplus is likely to narrow in 2006 as the government steps up efforts to spur consumption and discourages excessive low-end exports, a top government economist said on Friday.
Chen Dongqi, vice head of the Academy of Macro-economic Research under the National Development and Reform Commission, is confident that Beijing’s pledge to boost spending to rebalance the economy from investment and exports will show results.
It’s a vital part of government policy that China needs to change the ways it uses to promote foreign trade, improve the structure of exports and raise their quality, Chen told Reuters.
Chen did not say by how much he expects the trade surplus to fall in 2006. This year it is on course to reach $100 billion, more than triple last year’s $32 billion. The surplus in the first 10 months of 2005 came to $80.4 billion.
Efforts to spur consumption will help increase imports, he commnted.
China is under pressure from the United States and others to liberalize its currency system and let the yuan float higher in order to reduce the trade surplus.—Reuters
