The Ministry of Commerce remains optimistic about trade for the rest of the year and will maintain the policies adopted in the beginning of the year despite widespread concerns over the export slowdown, according to the vice-minister of commerce.

The current trade figures are within the government's expectations, and the export slowdown is the result of trade policy adjustments initiated earlier this year, Vice-Minister of Commerce Gao Hucheng said.

The growth rate of exports slowed to 21.9 percent for the first half, compared with the 27.6 percent increase over the same period last year. Exports for June alone went up only by 17.6 percent, much slower than the 28.1 percent rise in May.

Despite these figures, Gao said the Ministry of Commerce remains optimistic about the outlook in the second half of the year. "We estimate exports will maintain reasonable growth," said Gao. "The trade balance has improved, in accordance with our goals at the beginning of the year."

Trade balance and a structural adjustment of exports have been on the agenda of macro control measures initiated this year, and the recent trade data show these measures have started to work, said Gao.

Figures of the first half show imports rose rapidly and composition of the export basket changed. In contrast with the export slowdown, imports went up 30.6 percent. Export of electronic and machinery products, which takes up over half of the overall exports, jumped 25.3 percent to $389 billion. Export of hi-tech products also increased rapidly, up 21.8 percent, to $196 billion.

Export growth of products of energy-intensive and heavily polluting industries, by contrast, slowed down 16 percent.

Although export slowdown in some sectors have raised the specter of bankruptcy and rising unemployment, Gao said the trade policy would remain stable and the government's stance of reining in energy-intensive and heavily polluting enterprises would not change.

In June, export of garment and accessories slowed down by 15 percent to $9.8 billion, the lowest monthly increase this year. Export of garments for the whole year went up by only 3.4 percent to $49 billion.

Apart from the tightening policies, causes for the slowdown also include a faster appreciation of the yuan against the US dollar, which has made Chinese products more expensive, and the rising raw material and labor costs.

A US-led slowdown of the global economy has also cost Chinese exporters dear.

As a result, over two-thirds of textile enterprises are suffering losses. The average profit rate in the industry for the first five months of the year was only 1.1 percent, according to the Ministry of Commerce.

Enterprises are therefore seeking favorable government policies in these sectors. Some suggest a slower yuan appreciation or increased export tax rebate. A proposal by China National Textile & Apparel Council to the State Council reportedly seeks more export tax rebate on some textile products.

Top leaders, including Vice-Premier Wen Jiabao and Commerce Minister Chen Deming, have visited enterprises in Zhejiang and Jiangsu, both major textile export bases. Many see in these visits seeds of a possible policy change for the rest of the year.

"We'll continue to clamp down on energy-intensive and highly polluting industries, and will further investigate and evaluate the difficulties faced by some industries," said Gao when asked whether the tax rebate would be increased.