China’s import growth slows as exports soar

China said Wednesday that its politically sensitive trade surplus hit a record high in October as exports soared and import growth fell amid government efforts to rein in an investment boom.

The surplus in October jumped to $23.8 billion, up 27% from the previous high of $18.8 billion in August, according to the General Administration of Customs.

That raised China’s total surplus for the first 10 months of the year to $133.6 billion, already exceeding the $102-billion surplus for all of 2005, the agency said.

China’s growing trade gap has fueled demands by Washington and other trading partners for Beijing to raise the value of its currency, the yuan. That would make Chinese goods more expensive for foreign buyers and might restrain surging exports.

Four U.S. senators -- Charles Schumer (D-N.Y.), Lindsey Graham (R-S.C.), Max Baucus (D-Mont.) and Charles Grassley (R-Iowa) -- are crafting legislation that would apply pressure on China in the form of sanctions on imports, Schumer spokesman Eric Schultz said.

But one economist said Treasury Secretary Henry M. Paulson Jr. might be able to persuade China to act even without further pressure from Congress.

“The Chinese now very timidly and gradually are rebalancing their currency,” said Irwin Stelzer, director of economic policy at the Hudson Institute. That is because “they grasp that they can’t control inflation or overinvestment in their economy,” he said.

Exports in October totaled $88.1 billion, up 29.6% from the same month last year, while imports rose 14.7% to $64.3 billion, the customs agency said.

The export growth was about the same as September’s 30.6%, but import growth was down sharply from the 22% jump in September.

The reason for the change wasn’t immediately clear. But China’s government is in the midst of a campaign to cool off a boom in investment, which might be causing a drop in purchases of foreign factory equipment and other capital goods.

The government has tried to discourage lending by raising interest rates twice this year and cutting back on the money available for credit by requiring banks to set aside more reserves.

The drop in the import growth rate was especially striking because Beijing has allowed the yuan to rise gradually against the U.S. dollar in recent months. That should have encouraged imports by making foreign goods less expensive to Chinese buyers.

Wednesday’s report was released as EU Trade Commissioner Peter Mandelson was visiting Beijing. He pressed Chinese officials to ease what the EU says are unfair restrictions on European companies in China. The European Union is China’s biggest export market.

Mandelson said Tuesday that China should live up to its status as a major exporter by easing market barriers.

China’s trade surplus set record monthly highs in May, June, July and August before briefly dropping back to $15.3 billion in September.