Official data released on a recent Friday revealed that China’s major industrial firms have seen a notable acceleration in their profits, marking a positive trend in the nation’s economic landscape. The information, provided by the National Bureau of Statistics (NBS), indicates that the profits of major industrial firms, with an annual main business revenue of at least 20 million yuan (approximately 2.79 million U.S. dollars), surged by an impressive 11.9 percent year on year in the month of September.
This growth has been sustained for two consecutive months, portraying a promising economic outlook.
Yu Weining, a statistician at the NBS, noted that industrial profits in China have been steadily improving quarter by quarter. The third quarter of the year saw a substantial increase, with industrial firms experiencing a year-on-year profit climb of 7.7 percent. This upturn marked a significant turning point as it followed five consecutive quarters of declining profits, bringing a sense of optimism to the industrial sector.
This positive momentum in industrial profits can be attributed to the macroeconomic policy package implemented by the Chinese government. The policies have shown a tangible impact on boosting market demand and revving up industrial production. These measures have been pivotal in revitalizing the profitability of major industrial firms.
In the broader context of the year, the first nine months showed a 9-percent decline in the profits of major industrial firms. However, this decline is indicative of a narrowing trend, as it decreased by 7.8 percentage points compared to the first half of the year, as per NBS data.
A significant portion of the industrial categories monitored by the bureau, precisely 61 percent, reported improved performance in profits during the January-September period. This suggests that the recovery is broad-based, with a majority of sectors experiencing positive growth.
One notable sector is manufacturing, which saw a reversal of its profit decline in the second quarter. In the third quarter, the profit growth of manufacturing firms expanded by 11.8 percent, demonstrating a resilient and recovering manufacturing sector.
The consumer product manufacturing industry, which experienced declining profits in the first three quarters, also showed signs of improvement by narrowing the decline by 7.9 percentage points from the growth recorded in the first half of the year. This improvement can be attributed to a brighter economic outlook and pro-consumption policies.
To ensure the sustained recovery of China’s industrial profits, Yu Weining emphasized the importance of continuing efforts to expand effective demand, boost market confidence, stabilize business expectations, and promote new industrialization. These measures, combined with the positive momentum observed in recent months, are crucial for maintaining a robust and resilient industrial sector in China.