BEIJING, — Profits at China’s top industrial firms saw a narrower decline in May as factories in the world’s second-largest economy restarted production lines as the business climate improved, official data showed Monday.
Large industrial companies, each with revenue of at least 20 million yuan (about US$2.99 million), saw their profits fall 6.5% year on year in May, after the contraction by 8.5% in April, according to data from the National Bureau of Statistics (NBS) showed.
Revenue for these large companies rose 6.8% from a year ago last month, a faster pace of growth than in April, the data showed.
China’s industrial economy is stabilizing and recovering, said Xin Guobin, vice minister of industry and information technology.
Commenting on the May reading, NBS senior statistician Zhu Hong attributed the slower contraction to effective epidemic control, the resumption of business activities and progress in smoothing logistics.
In the first five months, major industrial enterprises made about 3.44 trillion yuan in total profit, up 1 percent from a year ago, according to NBS data.
Of the 41 industry sectors, 20 recorded annual profit growth or reduced the year-on-year profit contraction in May, while five managed to reverse the downward trend of the post expansion. -profit.
Last month, the country’s northeastern region and the Yangtze River Delta, where metropolis Shanghai is located, reported a much smaller decline in industrial profits compared to April, as these regions gradually shed the fallout. of COVID-19.
Boosted by political support and relatively high prices, the energy sector saw its profits jump in May. Profits in the coal, petroleum and natural gas mining industries more than doubled, contributing 9.5% to overall industrial profit growth last month.
Marginal profits in the equipment manufacturing sector saw a marked improvement from April, and better earnings were also reported among consumer goods producers last month, Zhu said.
Despite these positive changes, Zhu warned that given the relatively weak recovery base and the changing international landscape, there are still many uncertainties for industrial companies to make a profit.
Official data showed that China’s leading economic indicators improved in May. Its value-added industrial production, for example, reversed the decline in April and posted a year-on-year expansion last month.
To shore up the virus-hit economy, the State Council recently unveiled a set of 33 six-pronged measures to further stabilize the economy.
The Ministry of Industry pledged to focus on stabilizing industrial chains and strengthening support for small and medium-sized enterprises, to ensure the implementation of the package of measures.
Building on May’s momentum, Chinese industrial firms are likely to post better profits in June, said Zheng Houcheng, director of the Yingda Securities Research Institute.
A worker works on an assembly line at an agricultural machinery manufacturing company in east China’s Shandong Province, Feb. 15, 2022.
Originally posted by XinHua