The record trade surplus last year also led to calls from the US and the EU for Beijing to take measures to balance trade.

However, Chinese economists predicted the country's trade surplus is not likely to narrow substantially this year as it is a result of its strength as a global manufacturing center. But the growth in surplus is expected to slow, given the government's policies to restrict exports and encourage imports.

Despite the dazzling growth in the trade volume, traders are now facing "worsened" trading conditions, Customs Director Mu Xinsheng said in a recent interview.

He explained that costs of exports keep increasing not only because of price increases in resources, labor and land but also because the appreciation of the renminbi will further blunt the competitive edge of "Made-in-China" products.

The nation has also become the biggest victim of international trade protectionism with developed countries imposing an increasing number of dumping charges and erecting technical trade barriers against Chinese products.

"It will be more difficult for Chinese exporters to enlarge their market share in some major developed markets, such as the US and the EU, during the country's 11th Five-Year Plan (2006-10)," Mu said.

The Ministry of Commerce has predicted the country's trade volume would grow by 15 percent to $2 trillion this year.

The ministry stressed that although China is seeing big surpluses in the trade of manufactured goods, it also has a deficit in services which increased by 44 percent year-on-year to $5.7 billion in the first six months last year.

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