China to target emerging countries as exports slip

China will seek to boost exports to emerging economies next year in the face of "severe challenges" caused by downturns in Europe and the United States, a senior official said Wednesday. To cushion the impact on exports -- a major engine of growth -- Beijing will target developing countries that are growing strongly, said Wang Shouwen, director of the commerce ministry's foreign trade department. "Next year I think that we will face severe challenges in our exports and imports," Wang told reporters at the release of a white paper on foreign trade marking the 10th anniversary of China joining the World Trade Organization. "However, some developing and emerging economies are enjoying sound economic performances so we will attach more importance to exports to these countries." Wang did not name specific countries but said Latin America and the Asian region would grow next year and "have demand" for Chinese exports. Leading Chinese officials have painted a gloomy picture for the country's exports, warning that the eurozone debt crisis and sluggish recovery in the United States threatened the world's second largest economy. Vice Premier Wang Qishan, China's top finance official, at the weekend urged companies to help guarantee a "stable increase" in exports amid slowing external demand. China's exports rose 15.9 percent year on year to $157.49 billion in October, but the total was down from $169.7 billion in September, due to falling demand caused by the economic woes in Europe and the United States. Imports expanded 28.7 percent to $140.46 billion in October, lower than the $155.2 billion recorded a month earlier. Shipments to the European Union -- China's biggest trade partner -- fell to $28.74 billion in October from $31.61 billion in September. Exports to the United States shrank to $28.60 billion in October from $30.11 billion in the previous month. Shipments to developing economies such as India and Brazil fell by a lesser amount, though they accounted for a much smaller portion of the total exports. The data, coupled with figures last week showing China's manufacturing activity contracted in November for the first time in 33 months, has caused concern that the Asian powerhouse is losing steam. Wang told the news conference China would help companies in building brands, research and development and marketing to "allow them to be more competitive". But he said that if the European financial crisis "does not run out of control" then China should still achieve "a considerable level of growth" in foreign trade. In recent years China has been strengthening ties with developing economies in Asia and Latin America through trade and investment to reduce its exposure to developed markets. Bilateral trade with South American countries has sky-rocketed in the past five years by more than 160 percent, surging from $68 billion in 2006 to $178.9 billion in 2010. Premier Wen Jiabao last month offered Southeast Asian countries $10 billion in infrastructure loans while foreign investment in China from the Asian region ballooned in the first 10 months of this year to $81.9 billion. In stark contrast, US investment in China slumped 18.13 percent to $2.6 billion, while European Union investment increased just 1.05 percent to $5.5 billion.