China's foreign trade outlook 'gloomy'

China will face a more difficult situation regarding foreign trade next year because the economic recovery in Europe and the United States may be delayed and there may even be a retreat, a senior commerce official said on Thursday.

"The economy in the eurozone is expected to deepen the depression in 2013. That will continually reduce export orders for Chinese companies, said Wei Jianguo, the former vice-minister of commerce and the secretary-general of the China Center for International Economic Exchanges, a government think tank.

The export-oriented small and medium-sized business will have an even worse operational environment next year, he said at the 10th Anniversary Forum of the Cheung Kong Graduate School of Business.

At the same time, there is little optimism in a US recovery. The country is at a fiscal cliff edge, said Wei. "It is likely that the US will launch a fourth round of the quantitative easing policy next year, which will further dilute China's foreign exchange reserves."

Wei warned that the gloomy expectation for exports may further add to the downside risk in the world's second largest economy.

"The yuan may have come under more pressure to appreciate in the coming months, hitting small Chinese companies," he said.

He encouraged Chinese companies to speed up expansion in overseas markets and find more opportunities to grow through cross-border cooperation and acquisitions.

chenjia1@chinadaily.com.cn