by Elenoa Baselala
Fiji Times - Saturday, February 19, 2011
CHINA's trade integration with the Pacific has accelerated, the ANZ Bank says.
An analysis carried out by the bank showed that the Pacific's export growth to China had been driven by the resource-based economies.
The report says that China had been gaining a steady share of Pacific import markets.
As a result, the Pacific now imported more from China than New Zealand.
Australia remains the region's largest trading partner.
"The Pacific's export intensity to China has not increased but import intensity has grown considerably," the report said.
"We think trade deepening between China and the Pacific will continue, more or less unabated.
"China's trade with the Pacific has exploded over the past decade."
The report said that total trade between Pacific countries and China has grown on an average of 30 per cent, from a mere $180million in 2001 to over $1.5bn in 2010.
"Import growth has outpaced export growth, averaging 34 per cent a year, with imports reaching a peak of $726mn in 2009," the report said.
"Exports have grown 30 per cent on average since 2001, and surpassed $1.0bn for the first time in 2010.
"Trade flows, however, were affected by the global financial crises (GFC)." The report said Pacific export growth rebounded by a whopping 96 per cent in 2010, compared with a contraction of 25 per cent in 2009.
The level of exports reached $1.1bn in 2010.
In particular, exports from PNG to China more than doubled, exceeding $780mn, while the Solomon Islands also posted strong export growth of 61 per cent, with shipments reaching a record $287mn.
The slowdown in 2009, the report said, could be attributed to the GFC, while the strong pick-up in 2010 was due to China's resumed demand for minerals, oil and other resources from PNG and timber from the Solomon Islands.
But Pacific imports from China eased in 2010 after reaching record levels in 2009.
Imports contracted 16 per cent in 2010, compared with positive growth of 41 per cent in 2009.
This was the first negative growth rate in the decade.
Imports totalled $611m in 2010. The decline in imports from China in 2009 could be attributed to PNG's imports contracting 32 per cent to $353mn and Vanuatu's imports halving.
But Fiji's imports grew 32 per cent, Samoa's doubled, the Solomon Islands was up over 69 per cent, and Tonga's grew by 22 per cent.
