Exports to feel impact

China's pledge of a more flexible yuan will reduce the nation's exports this year, adding to difficulties that include the European debt crisis and rising costs, a Ministry of Commerce official said.

"I'm not optimistic about the exports this year," said Yu Jianhua, a Ministry of Commerce director-general, after a press conference during the Group of 20 meetings in Toronto yesterday. "It's essential for exporters to cut costs and keep their share in the world trade market."

China indicated last weekend that it was scrapping the yuan's two-year-old peg to the dollar and reiterated the issue at a media briefing on Friday.

The move may have muted criticism from United States President Barack Obama and other world leaders before the G-20 talks.

- BLOOMBERG