Industrial Profits in China fell 8.5% in April as Lockdown Measures Hit the Economy Hard

China’s National Bureau of Statistics (NBS) reported an 8.5% year-on-year decline in Chinese industrial profits in April. This was the sharpest decline since March 2020 and the reverse of March, when profits rose 12.2%. The Chinese industrial sector continues to suffer from rising material costs and supply chain issues due to lockdown measures to contain the spread of COVID-19. This is weighing on profits and leading to the suspension of production activities.

China’s industrial debt rose by 10.4% at the end of April. This was a slight slowdown from the 10.5% increase in March.

From January to April this year, Chinese industrial profits rose only 3.5% year-on-year to 2.66 trillion yuan, down from 8.5% in the first three months. The profits of Chinese industrial enterprises are based on large enterprises with annual sales of at least 20 million yuan. In Shanghai, China’s financial center, industrial profits fell by 61.5% due to the lockdown measures.

The Chinese premier told an emergency meeting yesterday (May 26) that the Chinese economy is in worse shape in some areas than it was in 2020, the year the coronavirus began spreading. The remarks reflect China’s stance, which accepts that the government may miss its target of raising gross domestic product (GDP) to 5.5% this year as China continues to take strict measures to contain the spread of the coronavirus. Economists forecast China’s GDP growth at just 4.5% in 2022, below the government’s target of 5.5%.

Leave a Reply

Change Language
%d bloggers like this: