China faces 'severe' year for foreign trade: state media

By AFP

July 15, 2010 Updated Mar 2, 2009 at 3:01 AM CDT

China's deputy commerce minister has warned the country's exporters face a severe situation in the year ahead as the global financial crisis deepens, state media reported Monday.

Zhong Shan, deputy commerce minister, said protectionist policies in other countries could further hurt sales of Chinese exports, the official Xinhua news agency reported.

"The financial crisis has not bottomed out yet, which may reduce the country's international trade markedly," Zhong said at a trade fair in Shanghai on Sunday.

"In addition, trade protectionism of some countries might escalate. Therefore, China's foreign trade in 2009 will face a severe situation," Zhong was quoted as saying.

Zhong said his ministry was developing new policies to cut taxes for exporters and boost confidence in the economy, the report said.

China's foreign trade topped 2.56 trillion dollars in 2008, but the year-on-year growth rate dropped below 20 percent for the first time in seven years, the report said, citing General Administration of Customs figures.

The total value was up 17.8 percent compared with 2007, but the growth rate was down 5.7 percentage points.

China's economy expanded by nine percent in 2008, dipping into single-digit territory for the first time in six years.

This year could be even worse, with the World Bank predicting economic growth in China at 7.5 percent, the lowest level in 19 years.

In a bid to reverse this trend, the Chinese government has announced it will implement a four-trillion-yuan (580-billion-dollar) stimulus package, its largest in history.

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