Credit controls slow mainland's industrial output growth to 17.3pc
Denise Tsang in Guangzhou
The mainland's industrial output grew at the slowest pace this year last month as a wave of tightening measures poured cold water on the sizzling economy.
The 17.3 per cent year-on-year expansion compared with 17.9 per cent growth in October, 18.9 per cent in September and the year's peak of 19.4 per cent in June, the National Bureau of Statistics said yesterday.
Economists said the central government's intensified efforts to curb lending in the past two months as well as a crackdown on inefficient and polluting mines and steel mills were starting to pay dividends.
'Some kind of slowdown is good for the economy and is exactly what state leaders want,' said Citi China economist Shen Minggao. 'Credit control has been tight.'
The central bank on Saturday raised the reserve requirement ratio for the 10th time this year to 14.5 per cent. The credit squeeze is expected to directly hit lending to small and medium-sized enterprises.
Still, in the first 11 months of the year, industrial output jumped 18.5 per cent from a year earlier, beating the full-year growth of 16.6 per cent last year.
Raw steel production posted the slowest growth last month, tapering off to 4.3 per cent from 13.5 per cent in October. However, transport and machinery-making industries jumped 26 per cent, followed by non-metal mineral manufacturing at 23.5 per cent growth.
Merrill Lynch economist Lu Ting said Beijing's policy of weeding out polluting and energy-intensive industries had taken its toll on the steel sector. 'Many inefficient steel mills have been shut down in northern China in recent months to clear up Beijing's skies before the Olympics next year,' he said.
The Asian Development Bank yesterday said economic growth was likely to taper off to 10.5 per cent next year from 11.4 per cent this year due to the tightening measures.