China's industrial profits soar 17.2% in Aug, ending year-long slump

27 Sep '23

2 min read

Pic: Shutterstock/chinahbzyg

Insights

Chinese firms with annual revenues of at least 20 million yuan saw their profits increase by 17.2 per cent YoY in August, following a 6.7 per cent decline in July.
Overall, from January to August, industrial profits decreased by 11.7 per cent YoY to 4.66 trillion yuan, as per government data.
Out of 41 major industrial sectors, 30 showed improvements.

For the first time in a year, China’s industrial profits have shown an increase, suggesting that the economy is steadily on the mend. A sharp uptick was noted in profits for August, following a period of decline, as per data by the National Bureau of Statistics (NBS). Industrial firms with an annual revenue of at least 20 million yuan (around $2.7 million) witnessed a year-on-year (YoY) profit jump of 17.2 per cent in August. This comes after a 6.7 per cent decline recorded in July.

For the period from January to August, the profits of industrial firms decreased by 11.7 per cent YoY, standing at 4.66 trillion yuan. However, this is an improvement over the 15.5 per cent drop experienced in the first seven months of the year.

Of the 41 key industrial sectors studied, 30 showed signs of improvement, which included accelerated growth, decreased rates of profit decline, or YoY growth in profits. One notable example is in the utilities sector; firms involved in the supply of electricity, heat, gas, and water saw their profits soar by 40.4 per cent YoY during the January-August period. This was an increase from the 38 per cent rise in the first seven months.

On the flip side, manufacturing companies recorded a 13.7 per cent contraction in profits in the first eight months, which, while significant, is an improvement from the 18.4 per cent shrinkage seen in the first seven months.

NBS statistician Wei Ning credited the uptick in industrial profits to a consistent resurgence in industrial output and enhanced company profitability, as a range of stimulus initiatives have gradually begun to make an impact.

Fibre2Fashion News Desk (NB)

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