China's increased demand for raw materials has sustained the upward trend in primary commodity prices, which determine an important part of export revenues of many developing countries. For instance, China's import demand for iron ore increased by more than 40 percent, copper by more than 100 percent and edible vegetable oils by about 80 percent during 2007.

China has also stepped up its efforts to strengthen South-South economic cooperation through trade agreements, increased direct foreign investment, and development assistance and debt relief, in particular with the least developed countries. For example, China has disbursed multi-billion US dollars in preferential loans to encourage Chinese enterprises to invest in ASEAN countries, and created a multi-billion dollars China-Africa Development Fund to stimulate Chinese investment in Africa, the report said.

China also canceled $1.47 billion of African debt and promised to double its assistance to Africa in 2009. China's aid is targeted mainly at energy, telecommunications and transportation, which have by and large been neglected by the traditional, OECD (Organization for Economic Cooperation and Development) country donors.

The report, however, also pointed out that China's financial support is highly concentrated in a small number of oil-and- mineral-exporting countries, and most of the aid is provided in kind by Chinese companies, using inputs of Chinese origin, including labor.

China's RMB appreciated by more than 6 percent against the US dollar during 2007, but China's surplus in its current account surged further, to about $300 billion. With a surplus in both its current account and capital account, China has accumulated more than $1.4 trillion in official foreign reserves.

The UN report said China's large current account surplus should be seen in the broader context of the problem of the global macroeconomic imbalances involving the huge external deficit of the US counterbalanced by surpluses elsewhere, including China. These imbalances can not be resolved unilaterally or bilaterally.