China, the world's biggest exporter, on Sunday said it would soon become the largest global importer as its trade surplus narrowed sharply.

China now the world's second largest importer will become the biggest importer in a few years, Chen Deming, China's minister of commerce said here.

China not only provides the world with high-quality products at low costs, but also buys high-end goods supplied by global brands, he said addressing the China Development Forum 2012.

The growth rate of China's retail sales stayed between 16 per cent and 18 per cent over recent years, higher than its GDP growth, indicating the country's huge purchasing potential, he said.

Chen said many Western politicians blamed China for global trade imbalance, but they seldom mentioned that China, with its population only accounting for 19 per cent of the world total, is also the world's second largest importer.

China's trade surplus narrowed 14.5 per cent year-on-year to $155.14 billion in 2011, with imports up 24.9 per cent to $1. 74 trillion.

China for the first time registered its largest trade deficit in a decade last month recording deficit of $31. 48 billion.

The imports went up by 39.6 per cent, the highest growth in 13 months, to $145.96 billion.

The falling exports, the mainstay of Chinese economy prompted Premier Wen Jiabao to scale down the growth target to an eight-year low of 7. 5 per cent this year.

Analysts believe that the lowered GDP target will create more leeway to rebalance China's economy and defuse price pressures in face of global turbulence and a pressing domestic demand for economic restructuring.

Chinese Fnance Minister Xie Xuren told the same forum today that China will further deepen the reforms to its fiscal and tax systems to enhance transparency of fiscal budgets and improve tax policies.

The nation will strive to promote budgetary policies to cover county-level areas this year and strengthen the regulation and transparency of government funds, Xie said.

Meanwhile, the country is mulling to increase the proportion of underlying tax, which is smaller compared with circulation tax under the current Chinese taxation system, Xie said.

The underlying tax includes income tax of individuals and corporate business income tax, while the circulation tax covers the VAT, turnover tax, and consumption tax.

Further, China will expand trials of replacing turnover tax with VAT in a bid to boost the development of the tertiary industry, he said.

Source :timesofindia.indiatimes.com