MercoPress. South Atlantic News Agency

China imports soar 86% in Jan; 2009 US trade deficit, smallest in eight years

China also became in January the world’s largest exporter in 2009

China's exports and imports grew substantially in January year on year. This suggested that global demand for Chinese made goods is continuing and Chinese consumers are spending too: imports soared 86%, according to Beijing figures.

Meanwhile the United States in December 2009 reported that the trade deficit was 10% more than in November and the highest for the twelve months.

China’s figures for January were slightly lower than in December but analysts say they show the country's trade with the rest of the world has stabilised.

The data came a day after figures from Germany confirmed that China had overtaken it to become the world's largest exporter last year.

January's exports from China were up 21%. Imports rose by almost 86%.

The totals were boosted by the comparison with a period a year ago when many factories had closed for Chinese New Year. This year the holiday falls in February.

Oil and commodities were also much cheaper a year ago than they are now, because of the slowdown in global demand, and that too helps to account for the huge growth in the cost of imports. But analysts say the data confirms that China's recovery is on track.

Some are worried to about Chinese manufacturers' profitability. Reports this week suggested some of the provinces where lots of exporters are based have already, or are planning to raise their minimum wages.

Local governments kept wage rates low during the downturn to help firms remain profitable, but now appear to be more willing to address workers' concerns.

Inflation is also worrying some experts. The country's Central Bank Governor insisted this week that price rises seen so far this year remain relatively low, but acknowledged his officials were keeping a close eye on the inflation data.

Meantime the US trade deficit rose to 40.2 billion in December, partly due to a 14.8% increase in oil imports. The December deficit was 10% higher than in November and the largest for 12 months. The US Commerce Department said exports totalled 142.7 billion US dollars while imports totalled 182.9 billon USD.

But for the whole of 2009, the deficit totalled 380.7 billion, the smallest in eight years.

In December, exports of goods and services rose for the eighth month in a row, climbing 3.3%, following strong sales of industrial materials and US-made vehicles and parts.

The recent decline in the value of the dollar against the Euro and other major currencies has helped to make US goods more competitive on overseas markets.

Imports were up 4.8% in December, with oil imports rising to their highest level since October 2008. Nevertheless economists believe the trade deficit will rise in 2010 as demand for imports continues to outpace export sales.