Sunday, January 16, 2022

China’s economy shows weakness amid outbreak and supply crisis

Growth in China’s factory output hit a 13-month low in August, as the COVID-19 delta version grows in southeast China and the global supply crunch lengthens.

The latest data released by China’s National Bureau of Statistics (NBS) on September 15 shows that industrial output has grown by 5.3 percent since 2020, which is 1 percent lower than the increase in July.

China’s retail sales rose 2.5 percent year-on-year in August – a creeping increase compared to an 8.5 percent increase from a month earlier and the lowest rate since August 2020.

China’s sluggish recovery in the past few months could be due to supply chain constraints, semiconductor shortages, restrictions on high-polluting industries and a moratorium on property investments within the country. A private sector survey showed that China’s service activity fell into contraction in August.

The shortage of supplies due to the pandemic is also partly to blame.

China’s vehicle sales fell 17.8 percent in August from a year earlier, due to the global chip crisis, falling for the fourth straight month. The market regulator on September 10 fined three auto chip dealers for the price hike.

Chinese regulators have asked some steel producers to cut production to curb industrial pollution.

“These factors are important [for the slowdown], said Chinese economist Leng Yan, who is also known for running the independent finance program “Kaijing Lengyan”.

Yet the year-over-year increase in China’s raw material prices is another driving force that was holding up producers, he told The Epoch Times on September 15, noting the fact that selling prices would rise in response. failed in

China’s factory-gate inflation hit a 13-year high in August, driven by rising raw material prices, NBS said on September 9.

“Profits of enterprises immediately fell and many suffered losses,” said Leng. “More companies cut or stop production.”

Luo Ya and Reuters contributed to this report.

Rita Lee is a reporter for The Epoch Times, which focuses on China-related topics. He began writing for the Chinese language edition in 2018.

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This News Originally From – The Epoch Times

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