The National Bureau of Statistics of China (NBS) has unveiled a significant upswing in the profits of Chinese industrial companies for November, marking a robust 29.5% year-on-year surge. This surge marks the fourth consecutive month of profit escalation, despite weaker demand in China’s private sector, prompting calls for enhanced governmental interventions to bolster the economy.
The statistical data, derived from a comprehensive survey of industrial enterprises with an annual main business revenue threshold of at least 20 million yuan (approximately 2.83 million dollars), reflects a positive trend. Notably, for the first 11 months of 2023, profits accrued by Chinese industrial companies amounted to 6.98 trillion yuan, showcasing a 4.4% decline year-on-year. However, this figure exhibits an improvement compared to the preceding ten months’ decline of 3.4%.
The NBS report delineated a differentiated performance across various sectors: revenue for Chinese state-owned industrial entities witnessed a 6.2% decline during the first 11 months, while foreign-invested industrial companies experienced an 8.7% downturn. Conversely, China’s private sector in the industrial domain displayed resilience, witnessing a 1.6% increase in profits during the same period.
Financial analysts foresee China inching closer to achieving its economic growth target of 5% for the year, propelled by strategic stimulus measures designed to invigorate post-COVID-19 recovery initiatives. However, the path to recovery remains uncertain, primarily attributed to persistent vulnerabilities in the real estate sector, escalating deflationary pressures, and other economic challenges.
The prevailing circumstances have elicited widespread calls for the Chinese government to implement additional stimulus measures to bolster economic resilience and navigate the complexities that continue to impact the nation’s economic trajectory.