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China’s Industrial Economy Started Well

Submit Time:05-06-2017 | Zoom In | Zoom Out

Author:Liu Kun | Source:Guangming Daily


How do you see the economic situation in the first quarter? 

“In the first quarter, China’s industrial added value of enterprises above the designated size increased by 6.8% year on year, with a year-on-year growth rate of one percentage point, including the added value of the manufacturing industry up 7.4%, a year-on-year growth rate of 0.9 percentage points,” disclosed by Zheng Lixin, Spokesperson and Director General of the Performance Inspection and Coordination Bureau of the Ministry of Industry and Information Technology (MIIT) at the State Council Information Office (SCIO) press conference held on April 26. China’s industrial economy achieved a good start in the first quarter of the year, with the positive industrial trends featuring stable running, the accumulation of the “good” factors, and intensively promoted reforms. 

China’s industry enjoys smooth running 

 “In the first quarter this year, our country’s industrial economy exerted efforts to overcome the difficulties, such as the complex, changeable internal and external environment, the increase of uncertain and unstable factors, with some indicators, some industries and regions running better than expected,” said Zheng Lixin. The “stable” trend of the country’s industrial economy is mainly manifested in the overall industrial stability, the smooth running of traditional industries and the stable supporting role of major industrial provinces.  

According to statistics, Mach this year saw a year-on-year increase of 7.6% in the industrial added value of enterprises above the designated size, maintaining above 6% in 13 consecutive months; in the first quarter, the industrial added value of consumer goods up 7.1%, including the industrial added value of light industry and textile industry up 8.2% and 5.1%, respectively; the production and operational state of the raw materials industry improved, and  the metallurgical industry shifted from a loss of 930 million yuan during the same period of last year to a profit of 45.3 billion yuan in January and February this year.    

In addition, from the regional perspective of regions, the first quarter witnessed higher growth rate of industrial added values of enterprises above the designated size in 20 provinces over the same period of last year, including the growth rate between 7% and 8% of industrial added value in the country’s top five provinces, namely Jiangsu, Guangdong, Shandong, Henan and Zhejiang, all higher than the country’s average level, rendering strong support for the country’s smooth industrial operations. 

The “good” factors continue to accumulate 

Recently, MIIT conducted an industrial questionnaire survey among 6,000 Chinese enterprises, with the results showing that enterprises reflecting good production and operational situation in the first quarter accounted for 44.2%, a year-on-year increase of 12 percentage points. “From such statistics, we can find that market expectations have primarily improved, and producers’ confidence has been boosted,” said Zheng Lixin. 

Zheng Lixin expressed that, at present, the “good” factors of China’s industrial economy are accumulating. The first quarter saw faster development in China’s advanced manufacturing industry, with the added value of the high-tech manufacturing industry up 13.4%, as well as the equipment and electronics manufacturing industry continuing to maintain its strong growth momentum, with their added value up 11.4% and14.9%, respectively.  

In terms of corporate effectiveness, in January and February, industrial enterprises above the designated size realized the profits of 1,015.7 billion yuan, a substantial growth of 31.5% year on year. From the market situation, by March this year, the industrial producer factory price index had maintained a rebound for seven consecutive months, with the amount of increase reaching 7.4% in the first quarter; the manufacturing PMI remained within the expansion interval, and above the entrepreneurs confidence threshold for eight consecutive months. “This indicates that the growth of China’s industrial economic production continues to accelerate, and market demand continues to grow,” said Zheng Lixin. 

The supply-side structural reform goes deeper 

Statistics show that, in the first quarter, China’s industrial capacity utilization of enterprises above the designated size registered 75.8%, 2.9 or 2 percentage points higher over the first quarter and the fourth quarter last year, respectively; based on cutting over 65 million tons capacity in the iron and steel industry last year, the first quarter saw a year-on-year increase by 4.6% in crude steel production, with the capacity utilization reaching 73.7%, or 0.7 percentage points higher than the capacity utilization in the fourth quarter last year.   

At present, the supply-side structural reform in China’s industrial field is gradually going deeper. MIIT is vigorously promoting the industries, including the iron and steel industry, to dispose the “zombie enterprises”, decomposing and implementing the plan to defuse the excess steel production capacity of 50 million tons in 2017, and rigorously combat against and clamp down on the illegal production behaviors, such as the “billet steel” (a poor-quality billet steel product which is produced against the State regulations and may cause safety hazards.)     

It is learned that, in May this year, MIIT will work with the National Development and Reform Commission (NDRC) to organize the member units of the inter-ministerial joint conference to carry out a nationwide special inspection, which is aimed to crack down on the “billet steel”, and strictly prohibiting the phenomena of replacing a shutdown with a temporarily ceased production, off-site transfer or resurgence, etc. “We must ensure that a complete ban against the “billet steel” can be in place by the first half of this year, and the enterprises failing to be banned in accordance with the due requirements shall be held for harsh and severe accountability,” said Zheng Lixin.        

Zheng Lixin noted that “while seeing that our industrial economy kicked off well in the first quarter, we are also supposed to see the difficulties and problems confronting our country’s industry,” and at present, the recovery of the world economy is slow, the domestic industrial investment grow rate is on the low side, the production and operational costs of enterprises are rising, the old and new energy conversion needs a certain process, the factors to support stable industrial growth are to yet to be further cultivated, and therefore, “in order to achieve China’s stable industrial growth and constantly improve efficiency, there is still much to be desired, and we need to exert our strenuous efforts”.      

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