Bilateral trade between China and Japan is expected to experience renewed growth over the next few months, jumping to at least US$200 billion by the end of this year, Ministry of Commerce spokesman Chong Quan said yesterday.

Chong told the 11th Sino-Japanese Economic Symposium in Changxing, East China's Zhejiang Province, that Sino-Japanese trade had experienced slower growth last year due to the deteriorating political relationship between the two countries in recent years.

This year's growth will see Japan retain its position as China's third-largest trading partner, after trade with the European Union and United States respectively reached US$217.31 billion and US$211.63 billion last year.

Sino-Japanese bilateral trade enjoyed growth of 11.8 per cent in the first eight months of this year, compared with an annual rise of just 9.9 per cent in 2005. However, the rise is lower than annual growth of 25.7 per cent notched up in 2004.

"Growth in bilateral trade between China and Japan is in the interests of both sides," Chong told the symposium, which was co-sponsored by China's People's Daily newspaper and Japan's Nihon Keizai Shimbun.

He said Sino-Japanese bilateral trade had experienced a slowdown in recent years, with the European Union replacing Japan as China's biggest trading partner in 2004. While Japan is now China's third-biggest trade partner, China is Japan's second-biggest.

Chong expressed optimism about the prospects for Sino-Japanese trade and economic relations.

"China has seen a 10.9 per cent rise in gross domestic product in the first half of 2006, the first year of its 11th Five-Year Plan (2006-10). We are also glad to see that Japan has maintained steady economic growth over the past four years. All these factors will offer valuable opportunities for the two countries to strengthen their bilateral co-operation and create new growth in bilateral trade," he said.

Participants from both sides at yesterday's event suggested China and Japan should expand co-operation in the fields of environmental protection and saving energy, an important aspect of the 11th Five-Year Plan.

According to the plan, China will invest around 3.8 trillion yuan (US$475 billion) in this field in a bid to build itself into an energy-saving and more environmentally friendly society.

"It is a promising field in which China and Japan will have active and effective co-operation. Japan has ample management experience and apparent technological advantages in the area, such as burning rubbish, processing sewage and the development of renewable energy," said Chong.

Nikai Toshihiro, Japan's former economy, trade and industry minister, said Japan looked forward to expanding co-operation with China in these fields.

"In addition to the environmental and energy sectors, there is great potential for China and Japan to develop trade co-operation in many new fields," he said.

"Today, about 80 per cent of Japan's investment in China is in the manufacturing industry. China's ambition in developing its electronic and biological technologies indicates more co-operation possibilities between Chinese and Japanese businesses," he added.

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