Profits at China’s industrial firms rebounded last month, driven by a boost in income from the high-technology manufacturing sector and signaling economic resilience amid trade tensions with the US.
Industrial profits rose by 2.6 percent from a year earlier, taking the gain for the first quarter to 0.8 percent, data released by the Chinese National Bureau of Statistics showed yesterday. Last month’s data compares with a 0.3 percent contraction for the first two months.
A turnaround in industrial profit is regarded as critical in lifting business confidence, and encouraging companies to invest and hire to help the Chinese government achieve its reiterated commitment to achieve about 5 percent economic growth this year.
Photo: EPA-EFE
High-technology focused manufacturers’ profit rose 3.5 percent in the quarter, reversing a 5.8 percent decline in the first two months of the year. Almost three-fifths of industrial sectors recorded profit growth last month, the statement said.
China on Friday said it would “fully prepare” emergency plans to protect the nation against increasing external shocks, as it defends its growth goals amid a deepening trade war with the US that is challenging the world’s No. 2 economy.
The country’s decisionmaking politburo pledged to create new monetary and policy tools to boost technology, consumption and trade. Such steps could allow for faster deployment of low-cost credit for investment in targeted areas.
“Incremental and existing policies have worked in concert, enabling the industrial economy to get off to a good start,” bureau analyst Yu Weining (于衛寧) said in a statement. “At this stage, the external environment has become more complex and severe, with an increase in unstable and uncertain factors.”
Separately, China yesterday said that it would lower the tax rebate threshold for foreigners visiting the country, an effort to boost consumption, as Beijing attempts to offset some of the damage of the trade war.
Tourists who spend at least 200 yuan (US$27.4) on the same day at the same store would be eligible for the rebate, according to a joint statement from the Chinese Ministry of Finance, the People’s Bank of China and other government departments.
The maximum rebate amount for cash claims would be increased to 20,000 yuan, it added.
The government would also expand the list of eligible tax-refund stores and streamline procedures to make it easier for tourists to claim the rebate, the joint statement said.
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