China's December trade surplus narrows

Data showed on Monday the Chinese trade surplus narrowed in December, easing the conflict between Beijing and Washington over rising U.S. trade deficit even as Chinese President Hu Jintao is scheduled to meet President Obama in the White House on January 19.

Beijing said on Monday the trade surplus in December was $13.1 billion, much lower than economists' consensus of more than $22 billion.

China's foreign trade is, in general, heading towards a balanced structure, China's General Administration of Custom said on its website.

However, Xinhua reported that China's trade surplus for the whole of 2010 narrowed 6.4 percent from the previous year to reach $183.1 billion primarily on account of higher imports.

The total value of China's foreign trade for the whole of 2010 was $2.97 trillion, which was 34.7 higher than in 2009, as exports once again remained robust, helping China retain its position as the world's largest exporter for the second consecutive year, beating Germany.

In December, foreign trade rose 21. 4 percent over the same month in the previous year to $295.2 billion.

Beijing would like to take heart from the significant dip in trade surplus as it's facing criticism from most of its trading partners, especially the U.S., over a monetary policy termed as 'mercantilist'. The U.S., which believes the Chinese yuan is artificially undervalued to give the country an edge in exports, has kept pressure high on Beijing to let its currency appreciate.

Meanwhile, China has ratcheted up criticism of the U.S. Federal Reserve’s policy of going for quantitative easing, a measure under which the central bank will buy assets to raise the amount of money in the market, saying such a policy leads to global imbalances by weakening the dollar.

Analysts say President Obama is unlikely retreat from the long-standing U.S. criticism of Beijing's yuan policy.
The U.S. president has made plain he will not apologize for temporary pro-growth measures that have riled Beijing, says a Reuters report.