China manufacturing continues sustained recovery as industrial profits grow for eighth straight month

Profits at China’s industrial firms surged 20.1 per cent year on year in December to 707.11 billion yuan (US$109.3 billion)

For 2020, annual profits for China’s industrial firms grew 4.1 per cent year on year to 6.45 trillion yuan (US$1 billion), recovering from a 3.3 per cent decline seen in 2019

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China is the only major economy in the world to avoid a contraction in 2020, with gross domestic product growing 2.3 per cent for the full year, while many countries remain crippled by the jolt from the coronavirus. Photo: Bloomberg

Published: 10:17am, 27 Jan 2021Updated: 11:19am, 27 Jan 2021

Profits at China’s industrial firms grew for the eighth straight month in December, suggesting a sustained recovery as the manufacturing sector rapidly emerged from its coronavirus slump.

Profits surged 20.1 per cent year on year in December to 707.11 billion yuan (US$109.3 billion), after rising 15.5 per cent in November, National Bureau of Statistics (NBS) data showed on Wednesday.

China is the only major economy in the world to avoid a contraction in 2020, with gross domestic product up 2.3 per cent for the full year, while many countries remain crippled by the pandemic.

Economists polled by Reuters expect China’s GDP to rise 8.4 per cent in 2021, the fastest pace in a decade. However, some analysts cautioned that a slower recovery in consumption and a potential rapid slowdown in credit growth could be risks for the Asian powerhouse.

China’s factory gate prices fell last month at their slowest pace since February, pointing to improving corporate profitability.