China Industrial Profits Falls At Faster Pace, Down 3% From Jan-Oct

Profits of China’s major industrial firms declined 3 percent year on year in the first 10 months of the year, data from the National Bureau of Statistics (NBS) showed.

Industrial firms with annual main business revenue of at least 20 million yuan (about 2.8 million U.S. dollars) each saw their combined profits reach about 6.98 trillion yuan in the period, the NBS said. The fall has been faster compared to the previous year.

Increase in Covid-19 cases has impacted the business sector severely as China continues to adhere to its Zero Policy measures which often disrupt productivity and meet supply deadlines. Cities like Guangzhou and Beijing have been experiencing a resurgence of cases hitting a new high of 30,000, which is causing all sorts of anxiety among workers at factories. A recent riot at a Foxconn factory that makes Apple phones, could be linked to a tipping point the people in China are frustratingly enduring.

Analysts are already forecasting a downward trend in GDP for the last quarter and suggest cutting their 2023 GDP forecast, predicting a slow and bumpy restart to the economy.

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