• Kyodo News


The Group of Eight major countries will call on China to make efforts to reduce its trade surplus by such means as a more flexible currency policy when their leaders meet next month in Germany, according to a draft of the summit’s economic statement obtained Friday by Kyodo News.

The draft says addressing trade imbalances is one of the priorities to keep the world economy stable.

China has rapidly expanded exports to developed countries, taking advantage of its cheap labor. Its trade surplus in 2006 came to $177.5 billion, up more than 70 percent from the previous year.

The figures have irritated the United States and other countries that have trade deficits with China, apparently prompting them in their statement to boost international pressure on Beijing to take action.

The draft of the statement to be issued at the June 6-8 summit in Heiligendamm, northern Germany, says the world economy faces underlying risks, including trade imbalances, despite being in generally good condition.

It says countries that regularly have trade surpluses, particularly China, should adopt a flexible and market-oriented currency policy and make more efforts for reform toward economic development based on domestic demand.

The G8 groups the U.S., Britain, Canada, France, Germany, Italy, Japan and Russia.

The leaders are also scheduled to express their pledges for continued efforts to ensure successful negotiations at the Doha Round of the World Trade Organization.

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