China’s industrial sector witnessed a robust rebound in June, with profits growing at an accelerated pace, driven by the gradual implementation of a series of stimulus measures and an overall improvement in industrial production. According to data released by the National Bureau of Statistics (NBS) on Saturday, industrial enterprises with annual revenues of at least 20 million yuan ($2.8 million) saw their total profits rise by 3.6 percent year-on-year in June, a significant increase from the 0.7 percent growth recorded in May.
For the first half of the year, China’s industrial profits expanded by 3.5 percent year-on-year, following a 3.4 percent growth rate in the first five months. This growth reflects the positive impact of macroeconomic policies and steady industrial production, as noted by NBS statistician Yu Weining. Yu emphasized that the improvement in industrial profits is a direct result of the effective implementation of these policy measures.
However, Yu also highlighted that the broader economy still faces considerable challenges, particularly from insufficient domestic demand and a complex and challenging external environment. These factors underscore the need for additional measures to strengthen the recovery foundation.
“Further efforts are necessary to actively expand domestic demand, foster new quality productive forces in line with local conditions, create new growth drivers, and cultivate new competitive edges,” Yu stated.
Among the 41 major industrial sectors surveyed, 32 experienced year-on-year growth in their profits during the first half of the year, according to NBS data. This widespread growth across various sectors underscores the overall resilience and adaptability of China’s industrial sector amidst fluctuating economic conditions.
Notably, the profits of industrial firms providing supplies of electricity, heat, gas, and water surged by 23.1 percent year-on-year in the first half of the year. Manufacturing companies also saw their profits rise by 5 percent during the same period. However, the mining sector faced a decline, with profits shrinking by 10.8 percent.
One of the standout performers was the equipment manufacturing sector, which recorded a profit increase of 6.6 percent in the first six months, 3.1 percentage points higher than the overall industrial profits. This surge was primarily driven by the rapid production and sales growth of high-tech products such as smartphones, integrated circuits, and new energy vehicles. Consequently, the electronics and automobiles industries experienced significant profit increases of 24 percent and 10.7 percent, respectively.
The robust performance of the equipment manufacturing and high-tech industries highlights the critical role of innovation and technological advancement in driving industrial growth. As China continues to prioritize these sectors, the country is well-positioned to enhance its competitive edge in the global market.
Looking ahead, the focus will be on sustaining this positive momentum by addressing the existing economic pressures and further stimulating domestic demand. The strategic development of new growth drivers and competitive edges will be crucial in ensuring the continued resilience and growth of China’s industrial sector.
In conclusion, China’s industrial profits saw a notable upturn in June, reflecting the positive impact of stimulus measures and improved industrial production. While challenges remain, the widespread growth across various sectors and the strong performance of high-tech industries offer a promising outlook for the country’s industrial future. Further efforts to expand domestic demand and foster new growth drivers will be essential in consolidating the foundation for recovery and sustaining long-term industrial growth.
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