Export of products with high energy consumption and heavy pollution were checked by tougher tariffs as the government made adjusting the export structure a focus of its trade policies.

 China had also sought to rein in its trade surplus by restricting processing trade. Processing trade reached 81.85 billion U.S. dollars in January, up 15.8 percent. However, the growth rate was 9.9 percentage points less than a year earlier, according to the administration.

    The trade surplus would probably grow more slowly in 2008, with the final outcome depending on how much China was affected by a possible economic downturn triggered by the credit crisis in the United States, which remains a key buyer of Asian goods and services, said Zhang Yansheng, head of the International Economic Research Institute under the National Development and Reform Commission.

    Sources with China's Ministry of Commerce forecast that trade in 2008 would remain at a high level, which could exceed 2.4 trillion U.S. dollars, but year-on-year growth would slow to about15 percent.

    Total trade in 2007 hit a new high of 2.17 trillion U.S. dollars, up 23.5 percent from a year earlier.

    Customs figures show last year's trade surplus surged more than47 percent to 262.2 billion U.S. dollars.

    The mounting surplus has fueled demands on the appreciation of the Renminbi from China's major trade partners, who argued that the Chinese currency was undervalued and gave Chinese goods advantages on the international market by making them cheaper to buy.

    China says it has already made currency regime more flexible and let the Chinese yuan appreciate steadily, with the yuan having appreciated about 12 percent since July in 2005, when the government started to revalue the Chinese yuan and de-peg it from the dollar.

    A weaker dollar and strong export growth reduced the U.S. trade deficit in 2007, which had been setting record highs for five consecutive years, as reported by the U.S. Commerce Department on Thursday.

    But international pressure remains as China sees more frictions with its trade partners.
The European Commission launched a new anti-dumping investigation into some steel products from China earlier this month, while the World Trade Organization panel said on Wednesday it upholds EU, U.S. and Canadian complaints that the Chinese tax measure on imported auto parts violates WTO rules.

    The International Monetary Fund (IMF) hopes to see a faster pace of Renminbi's appreciation, said IMF managing director Dominique Strauss-Kahn in Beijing on Friday when praising China's currency exchange rate reform is moving on the right direction.

    Strauss-Kahn also stressed the Chinese government faces challenges in rebalancing growth away from a heavy reliance on exports and investment towards consumption.

    China's sizzling economy has been driven largely by foreign trade, a majority of which was realized by foreign-funded companies.

    Trade by foreign-funded enterprises in January was 109.48 billion U.S. dollars in January, up 20.1 percent, accounting for 54.8 percent of the total trade, according to the customs.

    The European Union remained China's largest trading partner in January, with bilateral trade reaching 34.38 billion U.S. dollars, up 30.1 percent over the same month last year.

    The United States ranked as China's second-largest trade partner, with bilateral trade up 12.2 percent to 26.23 billion U.S. dollars.

    Japan took third place with bilateral trade climbing 15.3 percent to 20.18 billion U.S. dollars.

    India moved up one level to become China's ninth largest trade partner as Sino-Indian trade jumped 76.7 percent to 4.64 billion U.S. dollars in January, said the administration.