China's industrial profits fall by 12.8% in the semester

The profits of China's leading industrial enterprises fell by 12.8% year-on-year in the first half of 2020 as a result of the impact of the SARS-CoV-2 coronavirus pandemic, the National Bureau of Statistics (NBS) reported on Monday.

According to the NBS, profits in the January-June period were 2.51 trillion yuan (358.686 million dollars, 306.767 million euros). The indicator registered an 11.5% year-on-year increase in June, while in May the rise was 6%, the first month of the year to register growth.

For the elaboration of this indicator, the NBS only takes into account those industrial companies with annual revenues above 20 million yuan (2.86 million dollars, 2.44 million euros).

Of the 41 sectors collected by the statistics, 31 registered a reduction in their profits in the January-June period, while nine increased their profits and one remained unchanged.

Likewise, the profits of state-owned companies fell by 28.5% in the first six months of the year, while private companies fell by 8.4%.

The main industries affected were those processing oil, coal and other fuels (-124.1%), the extraction of oil and gas (-72.6%) and machinery and equipment repair (-53.7%).

At the opposite end of the spectrum, profits increased for companies dedicated to the manufacture of electronic, communications and computer equipment (27.2%), tobacco (24.2%) and the agricultural and food processing industry (14.8%).

NBS statistician Zhu Hong said that in China "the situation has continued to improve" over the months, with the "gradual implementation of preventive measures", while industrial activity resumed.

The expert stressed that in the second quarter, industrial profits of Chinese companies went "from decline to rise", and noted that "the pace of growth accelerated from month to month. However, Zhong noted that "market demand is still weak and enterprises still face many production and operational difficulties".