The contraction in China’s manufacturing worsened last month as the global downturn battered trade, data showed yesterday, and Chinese President Hu Jintao (胡錦濤) said problems due to the crisis were growing as he left for a London economic summit.
The monthly purchasing managers index by brokerage CLSA Asia-Pacific Markets showed manufacturing shrank for an eighth month last month. Based on a survey of some 400 companies, the index fell to 44.8, down from February’s 45.1, on a scale where numbers below 50 show activity is shrinking.
“Business conditions at Chinese manufacturers continued to deteriorate at a marked rate in March,” Hong Kong-based CLSA said in a statement. It said companies cut more jobs as orders declined.
The data suggested China is still mired in a slump despite a huge government stimulus and optimistic statements by Chinese Premier Wen Jiabao (溫家寶) and other officials. The central bank said last week the decline appeared to be slowing and data point to a recovery.
Manufacturing, which accounts for about 40 percent of China’s economy, has been battered by a collapse in exports and weaker Chinese consumer sales. The government said 20 million migrant laborers have been thrown out of work and leaders worry that further job losses could fuel unrest.
“China’s economic difficulties are clearly increasing,” Hu told Xinhua news agency during an interview before leaving for Thursday’s meeting in London of leaders from the G20 major economies to discuss the global crisis.
“This is mainly shown in declining trade, weakening industrial production, management difficulties in some industries and growing employment troubles,” Hu said. He gave no new details on job losses.
Hu was expected to use the London summit to push China’s demand for a bigger role in managing the world economy, including a more prominent place in the IMF and other finance bodies.