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Profits at China’s industrial firms rose 179 per cent year-on-year in the first two months of 2021 to 1.114 trillion yuan ($170.31 billion), according to figures released by the National Bureau of Statistics (NBS) on Saturday.
The jump extends the upwards trend to 10 straight months as the sector continues to recover from the coronavirus pandemic. That compared with a 20.1 per cent on-year increase seen in December and a 38.3 per cent on-year slump in the first two month of 2020, showed the data.
While this year’s numbers were influenced by a low comparison base, they still represent a 72.1 per cent increase from the first two months of 2019, and an annualised increase of 31.2 per cent for the past two years.
The figures combine data for January and February to exclude distortions caused by the week-long Lunar New Year, which fell in February this year.
Zhu Hong, senior statistician at the NBS, said in a statement that the government’s decision to encourage migrant workers not to return home for the Lunar New Year holiday – to help contain the spread of Covid-19 – had bolstered industrial production as companies were not closed for as long as they would normally have been.
He also acknowledged the effect of last year’s low base and the steady recovery of domestic and overseas demand. “Industrial enterprises continue to recover rapidly,” he said.
The NBS figures also showed a 3 per cent year-on-year increase in the average number of workers employed by industrial enterprises in the January-February period, but Zhu said it “must be noted that the international situation is still complex and severe, and domestic pandemic control measures cannot be relaxed”.
Balance had yet to be restored across all industries, and profit levels for some consumer goods were still below pre-pandemic levels, he said. “The foundations for a comprehensive recovery of the industrial economy needs to be consolidated.”
A breakdown of the industrial profit figures showed an 83 per cent year on year rise for the mining sector, a 220 per cent increase for manufacturing and a 57.5 per cent rise for utilities.
In total, 38 of China’s 41 industrial sectors reported a profit increase for the January-February period, compared with just 26 that did so for 2020 as a whole.
The NBS said the combined profits of the computer, communications and other electronic equipment manufacturing sector rose by 5,891.5 per cent year on year in the period, but profits in the oil and natural gas mining sector fell by 28.7 per cent.
State-owned industrial companies (182 per cent), private industrial firms (137 per cent) and foreign and Hong Kong-Macau-Taiwan-invested companies (219 per cent) also reported significant profit increases, it said.
The bureau’s figures cover firms with annual revenues of more than 20 million yuan from their main operations.
China managed to contain the COVID-19 pandemic before many of its peers last year, making it the only major economy to post full-year growth in 2020, with an expansion of 2.3 per cent.
Beijing has set a modest annual economic growth target at above 6% this year, well below analyst expectations. Chinese Premier Li Keqiang has defended the target, saying China is focused on consolidating its economic recovery and that setting hugely different growth targets from year to year would “disturb” market expectations.
China managed to contain the COVID-19 pandemic before many of its peers last year, making it the only major economy to post full-year growth in 2020, with an expansion of 2.3 per cent.
Beijing has set a modest annual economic growth target at above 6% this year, well below analyst expectations. Chinese Premier Li Keqiang has defended the target, saying China is focused on consolidating its economic recovery and that setting hugely different growth targets from year to year would “disturb” market expectations.
