Re­silience re­mains de­spite head­winds

China Daily (Latin America Weekly) - - Top News -

The as­set-li­a­bil­ity ra­tio of ma­jor in­dus­trial firms was 56.7 per­cent by the end of Septem­ber, 0.4 per­cent­age point down from a year ear­lier, the NBS said.

Dur­ing the Jan­uary-Septem­ber pe­riod, pro­duc­tion costs per 100 yuan of rev­enue dropped 0.29 yuan from the same pe­riod last year to 84.31 yuan. Prof­its in 34 of the 41 sec­tors sur­veyed in­creased com­pared with one year ear­lier, un­changed from that in the Jan­uary-Au­gust pe­riod.

Ac­cord­ing to the NBS, the steel, con­struc­tion ma­te­ri­als, oil and chem­i­cals sec­tors, which ac­counted for 72.4 per­cent of the over­all in­dus­trial profit in­creases, posted strong profit growth in the first nine months.

“China’s in­dus­trial profit growth re­mains sta­ble, al­though it is eas­ing,” said Gao Ming, an an­a­lyst at China Mer­chants Se­cu­ri­ties. “The eas­ing is wor­ri­some.”

Gao said the profit growth could con­tinue to trend down in the com­ing months.

“If the Chi­nese econ­omy con­tin­ues to weaken, the cor­po­rate sec­tor could face heav­ier pres­sure in terms of prof­it­mak­ing per­for­mance,” said Huang Wen­tao, an an­a­lyst at China Se­cu­ri­ties.

Satur­day’s data was re­leased af­ter the world’s sec­ond-largest econ­omy reg­is­tered slowed year-on-year GDP growth in the third quar­ter, which was 6.5 per­cent, down from 6.8 per­cent and 6.7 per­cent in the first and sec­ond quar­ters, re­spec­tively.

Al­though a slew of eco­nomic in­di­ca­tors, such as in­dus­trial out­put and in­vest­ment, weak­ened in the third quar­ter, an­a­lysts said China’s econ­omy re­mains re­silient.

De­spite the eas­ing in the third quar­ter, China’s GDP growth in the first quar­ter was 6.7 per­cent, which was still strong com­pared with other coun­tries, Chen Xian, an econ­o­mist at Shang­hai Jiao Tong Univer­sity told Chi­nese me­dia.

Huang said China is ex­pected to de­vise new poli­cies, such as those re­gard­ing fi­nance, consumption, ex­ports and cur­rency, to cush­ion the eco­nomic slow­down.

To sta­bi­lize growth, China should pro­mote the pri­vate econ­omy and push for­ward State-owned en­ter­prise re­form to build con­fi­dence in the mar­ket, said Gao.

Author­i­ties can pro­vide more sup­port for de­vel­op­ment of pri­vate en­ter­prises by cut­ting taxes, mak­ing it eas­ier for them to have ac­cess to bank lend­ing and loosen en­try into such sec­tors as el­derly care and health, he said.

Xin­hua con­trib­uted to this story.

Con­tact the writ­ers at xinzhim­ing@chi­nadaily.com.cn

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