China's trade surplus hit $22.4bn in May: official

June 12, 2007 - 0:0
BEIJING (AFP) -- China's trade surplus in May ballooned to 22.4 billion dollars, up 72.3 percent from the same month last year, state media said on Monday, citing a commerce ministry official.

The total trade surplus -- a source of tension particularly with Washington -- in the first five months went up 80 percent from a year earlier to 85.7 billion dollars, according to the official cited by the China Business News.

The trade surplus in the first half of the year was likely to hit 110 billion dollars if the current trend continued, according to various media reports citing Yang Hongbin, the commerce ministry official.

Yang attributed the runaway trade surplus growth to the rise in the exports of resource products, noting steel product exports in May soared 117 percent year on year despite the tightening of government curbs.

Last year, China's trade surplus jumped 74 percent to hit a record 177.5 billion dollars.

The dramatic expansion of the trade surplus in May will lead to further frictions with the United States and China's other major trading partners.

It is likely to offer further ammunition to the United States in its efforts to have China allow its currency, the yuan, to strengthen considerably.

The United States and others accuse China of keeping the yuan artificially low to make Chinese exports unfairly cheap.

Consumer prices gained 3.3 percent from a year earlier, according to the median estimate of 19 economists surveyed by Bloomberg News. April's inflation rate was 3 percent, matching the central bank's 2007 target.

China's producer-price inflation slowed in May to 2.8 percent from 2.9 percent in the previous month because of smaller increases in fuel costs, the statistics bureau said.