October foreign trade slows; surplus continues to fall

China's imports and exports in October both dropped from September, as uncertainties in the United States and Europe have slashed external demand, the General Administration of Customs (GAC) said Thursday. China's foreign trade in October fell 8.3 percent from September to 297.95 billion U.S. dollars, but still rose 21.6 percent year-on-year, according to GAC data. October exports weakened 7.2 percent month-on-month to 157.49 billion U.S. dollars, while imports dropped 9.5 percent month-on-month to 140.46 billion U.S. dollars. The October trade surplus fell 36.5 percent year-on-year to 17.03 billion U.S. dollars, far below the expected 25.8 billion U.S. dollars in the market. "The weakening of export growth in October turned out to be exactly as I expected," said Zhang Yansheng, director of the Institute for International Economics Research of the National Development and Reform Commission, China's top economic planner. "What we're facing now is a grave situation for exports and slowdown is inevitable in the third and fourth quarters," Zhang said, blaming shrinking external demand, rising costs, liquidity strains and an appreciating yuan. EU REMAINS TOP TRADER GAC data showed China's foreign trade with its major trading partners -- the European Union (EU), the United States and Japan -- slowed this year, compared to stronger growth in foreign trade with emerging economies. Despite the lingering debt crisis in Europe, the EU remained China's top trading partner during the January-October period, with trade amounting to 466.94 billion U.S. dollars, up 20.2 percent year-on-year. China's trade with the United States increased 16.8 percent from a year ago to 363.03 billion U.S. dollars. Zhang warned Europe and the United States are increasing trade protection measures against China. He cited the latest anti-dumping and counter-vailing investigation into Chinese exports of solar panels by the United States. A free trade area arrangement between China and the Association of Southeast Asian Nations (ASEAN) helped boost China-ASEAN trade by 25.7 percent year-on-year to 295.91 billion U.S. dollars during the period. China reported a trade deficit of 21.17 billion U.S. dollars with ASEAN, up 59.2 percent from a year ago. The nation exchanged goods and services worth 281.61 billion U.S. dollars with Japan in the first 10 months, a year-on-year increase of 17.7 percent. Trade with Australia, Brazil, Russia and South Africa grew much faster than average, increasing by 34.6 percent, 37.4 percent, 43.8 percent and 87 percent, respectively. During the January-October period, the country's trade surplus narrowed by 15.4 percent year-on-year to 124.02 billion U.S. dollars.