Chinese officials have today announced a $7.2bn trade deficit for March 2010, the first since a $2.3bn deficit in April 2004.
Yesterday, Yi Xiaozhun, vice-minister in the Chinese Ministry of Commerce had hinted that China is likely to announce a trade deficit for March.
But these are a good reason behind that: The growth of China's imports that is largely due to rising prices for commodities as well as the huge demand for raw materials to power China's economy. In the last few months China has been importing huge amounts of iron ore, copper, crude oil, coal and steel!
And whereas the US and European markets for Chinese goods are still weak, even though Chinese exports are recovering, they are not recovering, yet, as fast as China's imports are growing.
What is also noteworthy is that according to Mr. Yi Xiaozhun, China doesn't want a trade surplus or a trade deficit.