China's monthly trade surplus outstripped expectations in January to hit $19.5 billion (€13.3 billion), a 23 per cent year-on-year increase, underscoring the country's continuing export performance amid fears of a looming global economic slowdown.
The surplus, which increased eightfold between 2004 and 2007, has been widely forecast to stabilise this year amid signs of economic slowdown and weakening demand in the US and Europe.
The trend established in the final quarter of last year - when import growth outpaced export growth for three consecutive months for the first time since 2004 - continued in January.
Exports grew year on year by 26.7 per cent but imports rose by 27.6 per cent.
Steel exports, a major contributor to the rising surplus, have begun to fall following the government's removal of tax rebates. But textiles and electronics have yet to be significantly hit by the impact of the stronger renminbi and government policies aimed at constraining sales overseas.
The swelling trade surplus has made the country's tightly managed currency the target of persistent complaints from the US and Europe where politicians say the renminbi gives Chinese exporters an unfair advantage.
The renminbi was also the focus of talks in Beijing this week between Chinese leaders and Dominique Strauss-Kahn, head of the International Monetary Fund (IMF).
Mr Strauss-Kahn said he had tried to explain to the Chinese it was "in their own interest" to have a more flexible exchange rate and a faster appreciation of the currency. The renminbi has risen by about 13 per cent against the dollar since it was unpegged in mid-2005 but it has weakened against the euro.
China was angered by an IMF decision last year to establish a new currency surveillance mechanism through which the renminbi could be labelled as "fundamentally misaligned" in value.
Beijing regards the IMF mechanism as a potential tool through which the US can put pressure on it for a faster currency appreciation.
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