Export growth lifts figure to US$13.4b The mainland's trade surplus rebounded to US$13.4 billion last month on the back of strong export growth, quelling fears that weakening demand in the United States and Europe would derail the country's export juggernaut. Export earnings in the first quarter soared to US$306 billion, swelling the world's biggest foreign exchange reserve to a record US$1.68 trillion, up 39.94 per cent compared with the same period of last year. However, the trade balance for the first quarter shrank from US$46.5 billion a year ago to US$41.4 billion, confirming predictions that softening consumer demand overseas and rising imports at home will whittle away this year's trade surplus. 'Exports are not as robust as they once were, but the momentum of export growth remains stronger than most people thought,' said Paul Cavey, the chief China economist at Macquarie Securities. 'Although we can still expect the trade surplus to come down this year, it will remain substantial.' Last month's trade figures looked particularly strong after a statistical blip in February caused by seasonal disruptions to production. The value of exports outpaced imports for the first time in six months, surging 30.6 per cent year on year to US$109 billion, a recovery from February's anaemic 6.8 per cent export growth. 'March's figures show the backlog from January and February caused by the snowstorms and the Lunar New Year being cleared. Multiplying March's figures by three will give a better indication of what will happen in the second quarter,' said Glenn Maguire, the chief Asia economist at Societe Generale. Despite a moderate slowdown in import growth, a quarterly rise of 28.6 per cent saw imports outpace exports, largely reflecting higher commodity prices rather than a substantial rise in consumer demand. The value of crude oil, refined oil and iron ore almost doubled in the first quarter, while the value of soya bean imports rose 140 per cent to US$4.4 billion. With the US apparently in the early stages of recession and the rise of the yuan against the US dollar making mainland products there more expensive, export growth to the US last month limped to 5.4 per cent, the slowest for any region. 'China's export manufacturers are hurting from sharp increases in production costs and a stronger currency,' said RBS economist Ben Simpfendorfer, citing a recent survey suggesting that up to 20 per cent of Hong Kong-owned export factories on the mainland have closed as a result. The value of shipments to the European Union - the mainland's top trading partner - grew by a robust 24.2 per cent, buoyed by the continued strength of the euro against the yuan. 'This might just be a gasp for air for the downturn trend reasserts itself with the global slowdown,' warned Stephen Green, the chief China economist at Standard Chartered Bank.