BEIJING (Reuters) - China will have difficulty meeting its 10 percent trade growth target this year, Vice Premier Wang Qishan said in published comments, underlining challenges to supporting critical pillars for the world’s second-biggest economy.
Wang’s comments were in line with remarks last month from Commerce Minister Chen Deming, who said “if lucky” China would be able to achieve its annual target of 10 percent growth in exports and imports combined this year.
The remarks came as China cut interest rates for the second time in a matter of weeks on Thursday, stepping up efforts to bolster an economy that last quarter probably suffered its weakest growth since the global financial crisis.
Concerns that China’s trade targets could be in jeapardy may suggest the country’s downturn is proving deeper than expected.
Policymakers worldwide are growing increasingly concerned about the impact of the euro area debt crisis on the global economy.
The biggest worry for Asia’s exporting nations, such as China, is if the world economy slides into a repeat of the financial crisis of 2008/2009 when global trade ground to a halt.
Speaking during a visit to the eastern province of Jiangsu, Wang said China would import more high-tech equipment, manufacturing components, energy and consumer goods, while helping small- and medium-sized exporters cope with a credit squeeze.
China should not underestimate the impact of external shocks on its economy, although Beijing will try to keep trade growth stable as far as possible, the official Xinhua news agency quoted Wang late on Thursday as saying.
A full-year trade growth target of 10 percent already marked a significant slowdown from the first part of last year, when China’s annual expansion rate was averaging more than 20 percent.
The current global economy situation remains grim, with unstable factors and uncertainties increasing, Wang added.
A pair of Chinese manufacturing surveys has shown persistent weakness in the economy, with HSBC’s purchasing managers’ index showing factory activity shrank at its fastest pace in seven months in June and new export orders skidded to depths last seen in March 2009.
China is scheduled to release its trade data for June on July 10. Analysts forecast the data will show that exports grew 9.9 percent from a year ago with imports up 12.7 percent.
Despite slowing growth at home and abroad, Chinese export and import growth both surprised on the upside in May, with exports rising 15.3 percent and imports up 12.7 percent last month from a year earlier.
Reporting By Xiaoyi Shao and Koh Gui Qing; Editing by Ken Wills and Jacqueline Wong