Chinese industrial production thrives despite ebbing investment

Beijing, June 13 (IANS) The indicators of industrial production and retail sales maintained their growth in May, while investments in fixed assets slowed down, according to data released by the National Bureau of Statistics of China (NBS) on Monday.

Industrial production grew 6 per cent year-on-year in May, the same as the previous month, while retail sales shot up by 10 per cent – also similar to rates in April, when they increased by 10.1 per cent, EFE news reported.

Fixed asset investment rose 9.6 per cent in the first five months of the year compared to the same period last year – a 0.6 per cent drop over the growth recorded between January and April.

The indicator maintained its growth thanks to a 23.3 per cent rise in investment by state-owned firms against a 3.9 per cent growth in investment in the private sector.

However investment in real estate weakened, growing at 7 per cent between January and May compared to the same period last year, down slightly from the 7.2 per cent growth recorded during the first four months of the year.

Though industrial production in the economic powerhouse this month appears to be stable, slackening private sector investment has raised concerns about the medium-term prospects, according to economic research company Capital Economics.

The firm said public spending will remain strong over the next two quarters but will begin to weaken at the end of the year.

The NBS calculates the indicator based on data from companies with annual revenues of more than 20 million yuan ($3 million).



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