Reportedly, China’s manufacturing enterprises have posted significant losses with the COVID-19 pandemic continuing to hurt the local market. China’s manufacturing sector was the first to be bruised by the coronavirus devastating consequences.
Last month, the industrial enterprises in China incurred staggering losses, although the pace of a decline was slower than in January and February 2020. Moreover, the steepest fall was recorded in many sectors of the economy.
After several weeks of almost a complete shutdown, China's economy, the second-largest economy in the world, is slowly but surely getting back to normal. Primarily, China’s economic activity slowed down due to the COVID-19 outbreak that severely hit the health sector and triggered an unprecedented number of deaths. Now experts fear a second wave of the virus that is sure to push the Chinese economy in a recession.
In March, the profit of industrial enterprises in China shed by 36.7% year-on-year, not exceeding 781.45 billion yuan. Overall, China’s industrial firms earned 370.66 billion yuan ($52.43 billion), down 34.9% from a year earlier. Data from the National Bureau of Statistics showed that profits at China’s industrial firms slumped by 38.3% in January-February, the steepest drop since at least 2010.
According to analysts, market demand is far from recovery, and production costs remain high. So far, 8 out of 41 sectors of the economy recorded profit growth in March, while in January–February, only four industries reported an increase in the revenue. Therefore, the current situation seems rather grim. Nevertheless, economists believe that the slow economic recovery is a good sign indicating that soon the economy may return to its full capacity.
