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LEAD: China's foreign reserves top $800 billion for 1st time+(Japan Economic Newswire Via Thomson Dialog NewsEdge)BEIJING, Jan. 15_(Kyodo) _ (EDS: ADDING BACKGROUND) China's foreign exchange reserves totaled $818.9 billion at the end of December, officials said, topping the $800 billion mark for the first time and growing at a pace that could overtake Japan as the world's largest foreign reserve holder this year. According to official figures released by the People's Bank of China on Sunday, the December figure marks a 34.3 percent increase from a year earlier and a fourfold rise in five years. The size of Chinese reserves is currently the second largest in the world, following that of Japan's, which totaled $846.90 billion at the end of last year. The China Securities Journal has reported that the State Information Center, a Chinese government-operated think tank, believes the reserves would likely reach $950 billion at the end of 2006. If the projection holds, China could replace Japan as the world's largest foreign reserve holder this year as Japan's foreign reserves tend to fluctuate at a more moderate rate. While the Chinese central bank did not elaborate, China's foreign reserves have been augmented mainly by the country's huge trade surplus, which topped $100 billion in 2005 for the first time, and an inflow of foreign direct investment. The increase in reserves of the entire year was below the 51 percent growth recorded in the first half of the year, indicating that the pace of growth slowed in the latter half. |