China's industrial output up by 16.6%
The value-added output for state-owned and large non-state enterprises rose 16.6% in April from a year earlier to $85 mn.india Updated: May 17, 2006 14:34 IST
China's industrial output rose 16.6 percent in April from a year ago, the government said on Wednesday, with analysts pointing to a continued rise in domestic demand and sustained export growth.
The value-added output for state-owned and large non-state enterprises rose 16.6 per cent in April from a year earlier to 682 billion yuan ($85 billion), the National Bureau of Statistics said.
In the first four months of the year, industrial output was up 16.7 per cent, amounting to 2.46 trillion yuan, the bureau said in a statement.
The growth in production output in April was slightly lower than growth in March, during which output increased 17.8 per cent year-on-year, and about the same as the 16.7 per cent output growth in the first quarter.
Mo Jian, an economist for Everbright Securities in Shanghai, said the April figures were consistent with trends seen so far in 2006.
"It shows that domestic demand is still increasing," Mo said.
Mo said the figures indicate industry was still producing at a rapid pace even as the Chinese government had been striving for years to keep growth at a moderate level in order to avoid the economy overheating.
But while supply was high, so was demand, Mo said.
"Although the supply in all in China is increasing at a fast speed, the demand is even faster. The situation that demand outweighs supply will last for a long time," Mo said.
For the month of April, enterprises were able to sell 98.04 per cent of their output, up 0.19 percentage points from a year ago, the bureau said.
Huang Yiping, an economist with CitiGroup in Hong Kong, said although industrial output in April still grew at a fast rate, the government's hoped-for slowdown of the economy would eventually become more apparent.
"I think Chinas economy is slowing down gradually, like what the government expected," Huang said.
"With the control over investment, adjustment of loan rate and other macrocontrol measures, the slow-down will accelerate in the future."
The government has announced an overall economic growth target for this year of around eight percent, implying a significant slowdown from last year's 9.9 per cent.
However the government's estimate is widely regarded as very cautious. Targets in previous years have been easily exceeded and the economy grew 10.2 per cent in the first quarter alone.
In the figures released on Wednesday, exports of industrial products rose 22.4 per cent in April.
Sedan output grew 43.8 per cent in April as automobile production in general jumped 21.4 per cent, reflecting the importance of the auto industry for the national economy and the massive investment in this sector in recent years.
Among the main sectors, coal, crude oil and electricity production increased by 18.9 per cent, 2.6 per cent and 11.2 per cent, respectively.
Pig iron, steel and steel products output were up 17.4 per cent, 19 per cent and 27.5 per cent, while cement rose 19 per cent.
Output for clothing and textiles were up 13.1 per cent, chemicals and chemical products rose 16.9 per cent, while non-ferrous metals were up 20.7 per cent.
Electrical machinery production rose 14.9 per cent.
First Published: May 17, 2006 14:34 IST