New | China’s industrial profits fall for first time since 2000 as slowdown blamed on weak demand, high costs
Annual industrial profits drop 2.3 per cent last year compared with 3.3 per cent growth in 2014; state to cut loans to loss-making firms in bid to restructure economy
China saw annual industrial profits fall for the first time in more than a decade, prompting calls for strong stimulus to boost growth, even as Premier Li Keqiang on Wednesday vowed to cut loans to zombie firms and increase financial support for high-tech industries.
Industrial profits fell 2.3 per cent last year, compared with 3.3 per cent growth in 2014, the National Bureau of Statistics revealed on Wednesday. It was the first annual decline since at least 2000, according to Bloomberg.
READ MORE: China’s industrial profits fall 8.8pc in biggest decline in four years
Profits in December fell 4.7 per cent from a year ago, compared with 1.4 per cent in November.
The gloomy figures add to the economy’s grim start to the year, coming amid growing panic over the depreciation of the yuan and state media reports on short sellers’ “attacks” in manipulating the market for the renminbi and other Asian currencies.
Mounting concerns about China facing a hard landing as well as billionaire investor George Soros’ message last week about shorting Asian currencies have prompted state media to defend the Chinese economy and currency in their reports.
Data from the statistics bureau showed that 12 out of 41 industrial categories saw profits decline last year, including a 74.5 per cent drop in oil and gas exploration, a 70 per cent fall in the non-ferrous metal sector and a 65 per cent decline in coal mining.
