CHINA’S manufacturing sector saw the fastest growth in activity in three years in June, thanks to strong production and stabilizing employment, according to a private survey released on Monday, adding to growing indicators of a steady recovery in the world’s second-largest economy.
While Chinese businesses continue to face complex external challenges, including rising trade protectionism, a growing number of policy measures aimed at further stabilizing growth and improving the business environment will continue to boost vitality and improve business confidence, analysts said.
The Caixin China General Manufacturing Purchasing Managers’ Index (PMI) came in at 51.8 in June, up 0.1 points from the previous month, according to Caixin, a Chinese financial news outlet. The reading in June remained above the 50-point threshold that divides expansion from contraction and marked the fastest growth in activity since May 2021.
The Caixin PMI mainly tracks activity at smaller, private firms, while the official PMI largely focuses on state-owned and big manufacturing companies. In June, the official PMI came in at 49.5, unchanged from the reading in May, according to the National Bureau of Statistics (NBS) on Sunday.
“The Caixin PMI index focuses on private and small- and medium-sized enterprises, reflecting the recovery and development of these enterprises, and it is an important indicator of the continued consolidation and recovery of the economy,” Li Chang’an, a professor from the Academy of China Open Economy Studies at the University of International Business and Economics, told the Global Times on Monday.
Li noted that the data show that small and medium enterprises are in a state of expansion, which reflects the improvement of expectations and market vitality. However, businesses continue to face many challenges, including a relatively lower level of expectations and confidence, the expert said.
Commenting on the official PMI on Sunday, Zhao Qinghe, an NBS statistician, said that judging from the output, China’s economy generally maintained expansion, but the foundation for continued recovery still needs to be consolidated.
Cong Yi, a professor at the Tianjin School of Administration, said that thanks to continuous support from policy measures and continuously deepening reform, market confidence will continue to improve.
“Despite the pressure, China’s economy still maintains a strong growth momentum, showing strong confidence and a foundation for continued recovery,” Cong told the Global Times on Monday, pointing to strong signals from several recent meetings that point to stronger policy support going forward.
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