Trade gap with China widens

China’s government said Monday that it was trying to shrink its swollen trade surplus but reported that its monthly gap soared to the second-highest level on record in February amid threats of possible U.S. sanctions.

Commerce Minister Bo Xilai criticized proposed U.S. punitive tariffs as a violation of free trade and said they would hurt American companies.

“The Chinese government never intends to pursue a large-scale trade surplus with others,” Bo said. He said his ministry was “assigned to cut our trade surplus,” but he gave no details and announced no new initiatives.

U.S. lawmakers who blame low-priced Chinese imports for the loss of American manufacturing jobs are pushing for a 27.5% increase in tariffs on Chinese goods unless Beijing eases currency controls that they say give its exporters an unfair advantage.

“That would be disastrous for companies from both sides, including the United States, who have benefited from our trading relations,” Bo said. “If it were imposed, that would be not only trade protectionism but also trade hegemony.”

China’s customs agency reported Monday that the monthly trade gap in February rose to $23.7 billion, up 32.9% from the same month last year. That was just below the all-time monthly record of $23.8 billion in October.

Last year, the U.S. reported a record $232.5-billion trade deficit with China.

The White House has filed a World Trade Organization complaint accusing Beijing of violating commitments to the WTO by providing unfair subsidies to Chinese companies.

The Communist government has said repeatedly that it is trying to close its trade gap. It has cut export tax rebates for steel and other products and is encouraging people to spend more, which would boost imports.

Bo said a large share of the trade gap with the U.S. consisted of goods made in China by American companies and exported to the U.S. market.

The minister appealed for patience to let Chinese measures work.