According to statistics from the Ministry of Commerce, China's trade surplus in March amounted to US$11.19 billion, up 98.5 per cent on the previous month.
It is the second highest month-on-month record in history.
China's trade surplus increased tremendously last year. And the country's development blueprint for the 11th Five-Year Plan (2006-10) period explicitly states that "imports should be actively expanded." Against this backdrop, the large monthly increase in trade surplus has aroused widespread attention.
In effect, however, we should not overestimate the impact of the trade surplus change over a single month or even a quarter. We should at least examine the matter over the course of a year because such a study must be justified by longer-term observation.
It should be noted that the rapid growth in trade surplus in the first quarter has solid back-up in the basic economic conditions. Almost all of China's major trade partners are enjoying prosperous economic growth.
It is predicted that US economic growth could reach 4.5 per cent in the first quarter.
At the interest rate decision-making meeting of the US Federal Open Market Committee of the Federal Reserve Board on March 28, it was announced that growth slowdown in the US gross domestic product (GDP) during the fourth quarter of last year was only temporary and was a result of influence from special factors. The committee said that growth for the first quarter of this year was faring quite strongly and that momentum had become more mild and sustainable.
In Europe, the European Union (EU) manufacturing index in March reached the highest level since September 2000. The finance ministers of EU members have generally held that economic growth this year would reach 1.9 per cent.
Japan, whose economy has been battered in the past decade, achieved a GDP growth of 5.6 per cent in the fourth quarter of last year. Its capital expenditure increased by 9.5 per cent that quarter while other indices this year, such as the consumer price index, bank loan growth and corporate and public confidence in the economy, have been on the rise. The country is enjoying the longest period of economic expansion, such that the interest rate decision-making meeting on March 9 decided to put an end to relaxed monetary policies.
The strong economic growth of China's trade partners will inevitably lead to a growth in their imports. We should not worry about the resulting growth in our trade surplus or even carry it too far as to bear a sense of guilt. They have purchased Chinese products not as a result of coercion or improper competitive behaviour.
Another important factor behind the rapid increase in China's trade surplus growth is the "Spring Festival effect."
