Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.

If the statements above are all true, which of the following can properly be inferred on the basis of them?

(A) Countries with large national budget deficits tend to restrict foreign trade. There is nothing in the passage that says that.
(B) Reliable comparisons of the deficit figures of one country with those of another are impossible. There is nothing in the passage that says that.
(C) Reducing a country's national budget deficit will not necessarily result in a lowering of any trade deficit that country may have. Large national budget deficits do not cause large trade deficits. If they did, countries with the largest budget deficits would also have the largest trade deficits. In fact, when deficit figures are adjusted so that different countries are reliably comparable to each other, there is no such correlation.
(D) When countries are ordered from largest to smallest in terms of population, the smallest countries generally have the smallest budget and trade deficits. There is nothing in the passage that talks about population.
(E) Countries with the largest trade deficits never have similarly large national budget deficits. Close, but the use of 'never' makes it an extreme case. There still might be one or two countries where the two deficits are similar.
[spoiler]OA: C[/spoiler]

Would any one explain why it is the OA?

The argument basically says that budget deficits and trade deficits don't correlate. So if you're trying to predict trend in trade deficit with reduction in budget deficit, it will be difficult. C repeats this logic and so the answer.