The Chinese industry is showing some signs of recovery from the dip as a result of the strict corona measures in the country that disrupted production.
According to the latest figures from the Chinese statistics bureau, company profits fell year on year in May. But the decline was less pronounced than in April.
The easing of measures in China, which does not tolerate infections, allowed companies to resume production last month and improve logistics and sales. Corporate profits fell 6.5 percent year on year in May. That was 8.5 percent a month earlier.
Factories have struggled during the latest outbreak. Production was disrupted by the lockdowns and other measures. The effect of the restrictions in May was less damaging than in April as many cities started to relax the strict measures. However, the recovery is slow as authorities are doing everything they can to prevent new infections.
Earlier data showed that the manufacturing industry produced 0.7 percent more in May than a year earlier, compared to a drop of almost 3 percent a month earlier. That was already a signal that the revenues of the companies would also improve.
Beijing has repeatedly pledged to boost growth. Last week, President Xi Jinping reiterated the country’s 2022 growth target of around 5.5 percent and said the government will take steps to meet that target. Experts wonder whether that will be enough. On average, they expect 4 percent economic growth.