Chinese exports will face more technical barriers in the form of rising quality standards as the country's trade surplus continues to rise, Vice-Premier Wu Yi warned yesterday.

Figures from the Ministry of Commerce released yesterday show that foreign trade volume hit $2.2 trillion last year, up 25 percent year-on-year. Exports also increased by a fourth.

Wu did not disclose how much the full-year surplus was, but the ministry earlier forecast that it would hit $250 billion, compared with $177 billion for 2006.

Wu said the swelling trade surplus had triggered conflicts with other countries and set up barriers for Chinese exports.

"In particular, there's a tendency in international trade protectionism for product quality issues being increasingly used as technical barriers," Wu told a national conference on quality supervision, inspection and quarantine in Beijing.

The Japanese Positive List System that took effect in May 2006 was a case in point, she said. The system places stringent requirements on drug residues in agricultural products.

The implementation of the system caused an immediate drop in exports of Chinese agricultural products. Ministry figures show that exports of agricultural products to Japan in June 2006 were $596 million, a drop of $131 million, or 18 percent, from the same period in 2005.

Official figures show that about three in 10 Chinese export firms suffered as a result of foreign technical trade regulations in 2006, with direct losses of $36 billion.

Wu said that such cases would grow and technical barriers in the form of product quality standards would last for a long time.

Li Changjiang, head of the General Administration of Quality Supervision, Inspection and Quarantine, also warned that exports would encounter increasing technical barriers among major trading partners like the United States and the European Union in the coming years because of strict new rules on energy use and chemical content in those markets.

Li said most technical standards are adopted to protect human safety, animal and plant health, and the environment. However, there is a risk that some countries could use technical regulations and standards to protect domestic industries.

(China Daily January 4, 2008)