China’s economy starts 22 with vigor

BEIJING (Reuters) – With engines spinning and machines roaring, China’s industrial enterprises have started the first week after the Chinese Lunar New Year holiday full of vigor and vigor.

Facing multiple challenges in 2022, Rong Juchuan, founder of Beyond Group, a textile company headquartered in Ningbo, eastern China’s Zhejiang province, said the company “can’t just wait , but must take the initiative”.

In 2022, the company will prioritize improving its digital capabilities and leveraging new sales channels such as live streaming platforms to reduce operating costs and tap into potential demand, Rong said. .

Recent economic data has echoed this enthusiasm for the company. China’s manufacturing Purchasing Managers’ Index (PMI), a key economic barometer, stood at 50.1 in January, remaining in expansion territory for three straight months.

In particular, manufacturing business confidence was on the rise, with the production and operating activity forecast sub-index coming in at 57.5, up 3.2 percentage points from the previous month.

China’s economic performance in the first quarter is expected to beat market expectations, said Li Chao, chief economist at Zheshang Securities, citing PMI remaining above the boom-bust line for three straight months and growth regular credit.

The resilience of China’s industrial economy was also reflected in other barometers, including total electricity consumption.

One of the country’s industrial powerhouses, east China’s Jiangsu Province, saw its total electricity consumption rise 18.27 percent year-on-year during the holidays, while Hubei, a key manufacturing base in China, reported a 36.45% year-on-year increase. use.

According to an estimate by the China Electricity Council, the country’s total electricity consumption will increase by 5 to 6 percent year-on-year in 2022.

Faced with headwinds such as high commodity prices and supply chain challenges, China has prioritized stable growth for industrial development in 2022, which is the “ballast stone” of the market. macroeconomic.

Xiao Yaqing, minister of industry and information technology, said in an earlier interview with Xinhua that ensuring stable industrial growth, especially a good start in the first quarter of 2022, should be the most important task.

To ensure stable expansion, multiple measures have been deployed, including boosting the development of small and medium-sized enterprises, improving supply chain resilience, and highlighting the role of emerging sectors such as vehicles. new energies (NEV).

The ministry aims to incubate about 3,000 “little giant” companies this year, referring to small businesses in their early stages of development and focusing on cutting-edge technologies.

“In 2022, greater emphasis will be placed on promoting collaboration and innovation among small, medium and large enterprises,” said Xu Xiaolan, vice minister of industry and information technology. .

The NEV market could be another driver of Chinese industrial growth.

The country’s NEV sales ranked first in the world for a seventh consecutive year in 2021.

Going forward, China aims to further facilitate the growth of this burgeoning sector by alleviating chip shortages, improving support facilities such as battery swapping stations, and carrying out recycling and recycling. use of NEV power batteries.

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