China's foreign trade sector now faces unprecedented difficulties and is set to decline in the first half year, said Vice Minister of Commerce Zhong Shan on Wednesday.

It's increasingly difficult to make a quick turnaround and the situation will remain gloomy in the second half year, Zhong said.

He made the remarks at a national meeting on export credit insurance held by the Ministry of Commerce (MOC) and the China Export and Credit Insurance Corp. (Sinosure) - a policy-oriented insurer.

China should extend export credit insurance coverage and lower insurance rates to help exporters cut risks and insurers should help realize the State Council's aim to allocate 84 billion U.S. dollars of short-term export credit insurance scale this year and allocate special funds for large equipment exports, Zhong said.

Zhong urged more focus on exports of labor-intensive products and high-tech products and stressed the importance of upgrading trade structure.

Exports in April fell 22.6 percent from a year earlier, the sixth straight monthly decline, figures from the General Administration of Customs showed.

"There is no doubt China's foreign trade will decline this year as global demand remains sluggish," Zhuang Jian, a senior economist with the Asian Development Bank office in Beijing, told Xinhua on Thursday.

"Though there are some positive signals, for example growing shipping, they are not likely to be sustainable. If obvious recovery signals from major economies could be seen at the end of the year, China's trade might start to grow," Zhuang said.

(Xinhua News Agency June 4, 2009)